Oil And Gas THEME

1284.61 -21.55 (-1.68%) Sell

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OILANDGAS THEME investors dump it for better alternatives

14 min read

Oil And Gas was among the worst performers today. It lost -1.68% to close at 1284.61. During the last week it lost -5.35% and saw a maximum drawdown of -5.35%.

[Theme constituents]

Buy-and-Hold investors in ~OILANDGAS experienced a maximum drawdown of -23.22% over the last three months. It lost -20.44% during this strong down trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals. The net profit from Short signals was +14.57%.


~OILANDGAS has been underperforming the SP500 index in recent time, after having outperformed till 17 May, 2018. Over the last 2 years 11 months and 14 days, ~OILANDGAS outperformed the SP500 index on 52% days.

During the last three months ~OILANDGAS was mostly loss making and delivered on average -0.35% per day. It's best return during this period (of +2.54%) was on Monday, 3 Dec, 2018. While it's worst loss in the same period (of -3.85%) was on Wednesday, 24 Oct, 2018. There was initially a bullish trend during this period which started on 19 Sep, 2018 and went on till 25 Sep, 2018. The bullish trend returned +2.34% 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 -10.27% of investor capital.

~OILANDGAS had 6 profitable and 6 loss making months over the last year. During the last year, ~OILANDGAS underperformed SP500 index on monthly return basis. ~OILANDGAS was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -13.23% compared to -7.75% returned by SP500 index in Dec 2018. ~OILANDGAS had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year. It is interesting to note that both ~OILANDGAS and SP500 index significantly outperform during months when quarterly/annual results are announced.

"The road to economic well-being is to reward productive economic activity and to provide a moderate and predictable growth of money to finance real economic growth without reigniting the fires of inflation.

~OILANDGAS 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 ~OILANDGAS's volatility from 20 Sep, 2018 to 26 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 ~OILANDGAS has significant positive skewness in it's return distribution. This indicates that investors can expect ~OILANDGAS to recover from drawdowns quickly. Which makes ~OILANDGAS a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

On a general note (since you are interested in ~OILANDGAS), three instruments that have performed similar to ~OILANDGAS are OTTR, ~BIOTECHBRKTHRU and SAFT. They must all be evaluated as alternative investment options and for diversification.

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