Semiconductors THEME

1825.12 +25.08 (+1.37%) Sell

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Don't even consider investing in SEMICONDUCTORS THEME now, it is a really dangerous investment now

14 min read

Semiconductors was among the worst performers on Tuesday. It increased by +1.37% to close at 1825.12. On a day when the overall market breadth was 34%, it closed higher than 82% of the market. In comparison, the benchmark SP500 index closed today at +0.01%.

[Theme constituents]

~SEMICONDUCTORS showed a strong bearish trend over the last 3 months. During this period ~SEMICONDUCTORS fell by -12.07% and saw a maximum drawdown of -19.35%. There was a short signal during this period which returned +12.07%.


~SEMICONDUCTORS has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 12 Feb, 2016 to 12 Mar, 2018. Over the last 2 years 11 months and 14 days, ~SEMICONDUCTORS outperformed the SP500 index on 57% days.

During the last three months ~SEMICONDUCTORS was mostly loss making and delivered on average -0.18% per day. It's best return during this period (of +5.53%) was on Wednesday, 31 Oct, 2018. While it's worst loss in the same period (of -6.94%) was on Wednesday, 24 Oct, 2018. The longest stort-term trend during this period was 6 losing days, which started on 4 Oct, 2018 and ended on 11 Oct, 2018. This bearish trend lost -11.2% of investor capital.

During the last year ~SEMICONDUCTORS had 5 profitable months and 7 loss making months. ~SEMICONDUCTORS returned profits in fewer months than SP500 index. ~SEMICONDUCTORS significantly outperformed SP500 index in May 2018, when it returned +10.27% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. ~SEMICONDUCTORS had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Aug 2018 to Oct 2018) during which period it delivered -14.6%.

Trading mastery is a state of complete acceptance of probability, not a state of fight it.
-- Yvan Byeajee

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

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

Based on your interest in ~SEMICONDUCTORS you may find it interesting to know that OPNT is highly volatile and investors investing in it must take extreme caution. Consider either reducing your exposure to OPNT or sufficiently diversifying your portfolio.

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