Industrial THEME

1388.41 +7.2 (+0.52%) Sell

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Stop-loss on the minds of INDUSTRIAL THEME investors as it destroyed investor wealth

14 min read

Industrial was among the worst performers on Tuesday. It grew by +0.52% to close at 1388.41. On a day when the overall market breadth was 34%, it closed higher than 75% of the market. In comparison, the benchmark SP500 index closed today at +0.01%.

[Theme constituents]

~INDUSTRIAL is currently in a down trend. The current bearish signal has generated a profit of +14.17% for investors in the last three months.


~INDUSTRIAL has been underperforming the SP500 index in recent time, after having outperformed till 12 Jan, 2018. Over the last 2 years 11 months and 14 days, ~INDUSTRIAL outperformed the SP500 index on 55% days.

During the last three months ~INDUSTRIAL was mostly loss making and delivered on average -0.3% per day. It's best return during this period (of +2.35%) was on Wednesday, 28 Nov, 2018. While it's worst loss in the same period (of -4.56%) was on Tuesday, 4 Dec, 2018. There was initially a bullish trend during this period which started on 19 Sep, 2018 and went on till 21 Sep, 2018. The bullish trend returned +0.42% to investors. This was followed by a bearish trend that started on 17 Oct, 2018 and ended on 24 Oct, 2018. This bearish trend lost -8.72% of investor capital.

~INDUSTRIAL had 5 profitable and 7 loss making months over the last year. During the last year, ~INDUSTRIAL underperformed SP500 index on monthly return basis. ~INDUSTRIAL was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -12.09% compared to -7.75% returned by SP500 index in Dec 2018. ~INDUSTRIAL had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Feb 2018 to Apr 2018) during which period it delivered -7.57%. It is interesting to note that both ~INDUSTRIAL and SP500 index significantly outperform during months when quarterly/annual results are announced.

It's good to have money and the things that money can buy, but It's good, too, to check up once in a while and make sure that you haven't lost the things that money can't buy.
-- George Lorimer

~INDUSTRIAL 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 ~INDUSTRIAL's volatility from 19 Sep, 2018 to 4 Dec, 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 ~INDUSTRIAL has significant positive skewness in it's return distribution. This indicates that investors can expect ~INDUSTRIAL to recover from drawdowns quickly. Which makes ~INDUSTRIAL a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

On a general note (since you are interested in ~INDUSTRIAL), NIHD has performed really well this year and deserves to be closely tracked for investment opportunities.

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