China Internet THEME

1126.24 -9.82 (-0.87%) Sell

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The party never started for CHINAINTERNET THEME investors as it significantly underperforms

14 min read

China Internet ranked among the worst performers on Tuesday. It returned -0.87% to close at 1126.24. It is currently trading -40% below it's 52 week high of 1892.75.

[Theme constituents]

~CHINAINTERNET is currently in a down trend. Over the last three months 2 bearish signals have generated a profit of +8.25% for investors.

Trend

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

~CHINAINTERNET returned losses on 61% days in the last three months. During this time, it delivered on average -0.23% per day. It delivered it's best daily return of +7.3%, during this period, on Thursday, 1 Nov, 2018. There was initially a bearish trend during this period which started on 4 Oct, 2018 and went on till 11 Oct, 2018. The trend delivered -12.93% losses to investors. This was followed by a bullish trend that started on 30 Oct, 2018 and ended on 1 Nov, 2018. This bullish trend delivered +13.38% to investors.

On monthly basis, ~CHINAINTERNET delivered losses in more months over the last year, than profits. ~CHINAINTERNET delivered profits less regularly than SP500 index. ~CHINAINTERNET was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -13.2% compared to -7.75% returned by SP500 index in Dec 2018. ~CHINAINTERNET had a longer winning streak of losing months than SP500 index. It went down in 5 straight months (from Jun 2018 to Oct 2018) during which period it delivered -42.3%. It is interesting to note that both ~CHINAINTERNET and SP500 index significantly outperform during months when quarterly/annual results are announced.

If you don't value your time, neither will others. Stop giving away your time and talents. Value what you know & start charging for it.
-- Kim Garst

~CHINAINTERNET is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in ~CHINAINTERNET's volatility from 27 Sep, 2018 to 1 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 ~CHINAINTERNET 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.

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

On a general note (since you are interested in ~CHINAINTERNET), two large cap instruments that deserve special mention are CSCO and MSFT. They have significantly outperformed the overall market.

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