Beverages THEME

1100.46 -9.28 (-0.84%) Sell

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Don't buy BEVERAGES THEME now, it is a high risk investment

14 min read

Beverages significantly underperformed today. It lost -0.84% to close at 1100.46. It's recent 5 day performance has been -2.12%, -1.73%, -0.74%, +1.1% and +0.27%.

[Theme constituents]

~BEVERAGES showed a strong down trend over the last 3 months. During this period ~BEVERAGES lost -14.33% and saw a maximum drawdown of -15.17%. There was a short signal during this period which returned +14.33%.


~BEVERAGES has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 14 days, ~BEVERAGES underperformed the SP500 index on 47% days. Which indicates that on days ~BEVERAGES underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

~BEVERAGES returned losses on 58% days in the last three months. During this time, it delivered on average -0.24% per day. It delivered it's best daily return of +2.53%, during this period, on Tuesday, 16 Oct, 2018. There was initially a bullish trend during this period which started on 26 Sep, 2018 and went on till 1 Oct, 2018. The bullish trend returned +1.12% to investors. This was followed by a bearish trend that started on 8 Nov, 2018 and ended on 15 Nov, 2018. This bearish trend lost -6.16% of investor capital.

~BEVERAGES had 4 profitable and 8 loss making months over the last year. During the last year, ~BEVERAGES underperformed SP500 index on monthly return basis. ~BEVERAGES was also a less risky investment than SP500 index as it's worst month in the last year, Dec 2018, returned -6.62% compared to -7.75% returned by SP500 index in Dec 2018. ~BEVERAGES had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Aug 2018 to Dec 2018) during which period it delivered -20.11%. It is interesting to note that both ~BEVERAGES and SP500 index significantly outperform during months when quarterly/annual results are announced.

"The real measure of your wealth is how much you'd be worth if you lost all your money

~BEVERAGES is becoming more volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in ~BEVERAGES's volatility from 19 Sep, 2018 to 13 Nov, 2018. While there was a significant surge in the SP500 index's volatility from 19 Sep, 2018 to 29 Oct, 2018.

Advanced/professional short-term investors should note that ~BEVERAGES has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

SP500 index has more chance of extreme outcomes than ~BEVERAGES. Therefore, SP500 must receive a lower allocation than ~BEVERAGES in your portfolio. SP500 index usually has shorter drawdown period than ~BEVERAGES.

On a general note (since you are interested in ~BEVERAGES), AMZN is a large cap that deserves to be closely tracked for investment opportunities.

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