Software As A Service THEME

2012.4 +22.62 (+1.12%) Sell

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Waiting to invest in SAAS THEME? Avoid at the moment as it was among the worst performers

14 min read

~SAAS was among the worst performers today. On a longer term basis, investors in Software As A Service made +0.12% per day. Tuesday's performance of +1.12% was a outperformance compared to it's daily average.

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~SAAS showed a strong bearish trend over the last 3 months. During this period ~SAAS delivered -14.08% and saw a maximum drawdown of -19.45%. There was a short signal during this period which returned +10.29%.


~SAAS has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 27 Jun, 2016 to 14 Sep, 2018. Over the last 2 years and 6 months, ~SAAS outperformed the SP500 index on 60% days.

~SAAS returned losses on 51% days in the last three months. During this time, it delivered on average -0.21% per day. It delivered it's worst daily return of -7.28%, during this period, on Monday, 19 Nov, 2018. The longest stort-term trend during this period was 5 losing days, which started on 4 Oct, 2018 and ended on 10 Oct, 2018. This bearish trend lost -11.54% of investor capital.

The last 12 months saw ~SAAS's investors making profits in 7 months and incurring losses in 5 months. ~SAAS was less consistent in delivering monthly returs than SP500 index. ~SAAS significantly outperformed SP500 index in Aug 2018, when it returned +16.45% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ~SAAS had a shorter streak of profitable months than SP500 index. It only went up in 5 straight months during the last year.

"If investing is entertaining, if you're having fun, you're probably not making any money. Good investing is boring.

~SAAS is currently seeing overall fall in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in ~SAAS's volatility from 28 Sep, 2018 to 19 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 ~SAAS has significant positive skewness in it's return distribution. This indicates that investors can expect ~SAAS to recover from drawdowns quickly. Which makes ~SAAS a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

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

Based on your interest in ~SAAS you may find it interesting to know that AMZN is a large cap that has shown remarkable performance and deserves to be on every investors' watchlist.

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