HOMEBUILDERS THEME is a falling knife, continues to bleed every investor trying to catch it

~HOMEBUILDERS was among the worst performers today. On a longer term basis, investors in Home Builders made +0.05% per day. Tuesday's performance of +1.49% was a significant outperformance compared to it's daily average.

[Theme constituents]

Buy-and-Hold investors in ~HOMEBUILDERS experienced a maximum drawdown of -24.2% over the last three months. It returned -23.07% during this strong down trending period. There were no long signals during this period, where the short signal generated good profits of +23.07% for investors.

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~HOMEBUILDERS has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 14 days, ~HOMEBUILDERS outperformed the SP500 index on 54% days.

During the last three months ~HOMEBUILDERS was mostly loss making and delivered on average -0.39% per day. It's best return during this period (of +5.14%) was on Tuesday, 30 Oct, 2018. While it's worst loss in the same period (of -5.79%) was on Tuesday, 4 Dec, 2018. There was initially a bearish trend during this period which started on 20 Sep, 2018 and went on till 1 Oct, 2018. The trend delivered -9.72% losses to investors. This was followed by a bullish trend that started on 30 Oct, 2018 and ended on 5 Nov, 2018. This bullish trend delivered +9.85% to investors.

On monthly basis, ~HOMEBUILDERS delivered losses in more months over the last year, than profits. ~HOMEBUILDERS delivered profits less regularly than SP500 index. ~HOMEBUILDERS was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -10.6% compared to -7.75% returned by SP500 index in Dec 2018. ~HOMEBUILDERS had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from May 2018 to Jul 2018) during which period it delivered -4.08%.

Finance is not merely about making money. It's about achieving our deep goals and protecting the fruits of our labor. It's about stewardship and, therefore, about achieving the good society.
-- Robert J. Shiller

~HOMEBUILDERS 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 ~HOMEBUILDERS's volatility from 19 Sep, 2018 to 30 Oct, 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 ~HOMEBUILDERS has significant positive skewness in it's return distribution. This indicates that investors can expect ~HOMEBUILDERS to recover from drawdowns quickly. Which makes ~HOMEBUILDERS a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

On a general note (since you are interested in ~HOMEBUILDERS), two instruments that deserve special mention are AYTU and RGSE. They have significantly outperformed the overall market.