Underperform

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Underperform

In general, this means to do worse than some particular benchmark. Mutual Fund XYZ is said to underperform the S&P500 if its return falls short of the S&P500 return. However, this language does not take risk into account. That is, one might have a lower return than the benchmark in a particular year because of lower risk exposure. Underperform is also a term used by analysts to describe the prospects of a particular company. Usually, this means that the company will do worse than its industry average. Related: outperform.

Underperform

A broker's or brokerage firm's rating of a security. Such a security is expected to do marginally worse than the market as a whole for the period of time it holds the "underperform" rating. Some firms call the rating "market underperform" "moderate sell" or "weak hold." Different firms have different rating systems, but "underperform" is usually one rating above "sell" and one rating below "market perform" or "neutral." For example, if the market is expected to rise slightly, but a certain company's fundamentals are thought to be slightly weaker than the rest of the market, a brokerage firm might change that company's rating from market perform to underperform.
References in periodicals archive ?
In terms of curing early arrears, as measured by the percentage amount of loans that were 31-90 days in arrears at the beginning of the reporting quarter but which cured by the end of the quarter, banks reported their greatest underperformance on record".
When you hesitate, like this CEO was, then you allow underperformance to score.
They examine the record of the three superstar funds and show that their worst stretches of underperformance ranged from 18 quarters (for Mutual Shares) to 23 quarters (for the Magellan Fund).
Over the lifetime of a pension participant or a trust account, this becomes significant sustained underperformance, placing fiduciaries squarely in the crosshairs of the plaintiff's bar.
Flat racing's problem is that there's too much of it compared to the jumping alternative, and I suspect you could easily chart the relative underperformance of Flat racing as the number of Flat fixtures has increased.
Although the hotel sector does have a high delinquency index for that year, the underperformance actually recurs across all property types.
Across SEOs, I find similar levels of underperformance for both small firms and large firms, and both growth firms and value firms.
Berman attributes the underperformance of real estate stocks to the money going into the Standard & Poor 500.
But that conclusion was questioned by some analysts who said Disney appeared to be in the midst of a continuing evaluation of the network in the light of its underperformance in the past two years.
Since Fitch's downgrade of Cohen's CAM rating to 'CAM2' from 'CAM2+' on August 5, 2008, the company has experienced continued organizational and staffing changes, against a backdrop of marketwide underperformance of TruPS CDOs.
Barington is concerned by the Company's sustained period of underperformance relative to its peers and the market as a whole under its current management team.
It is true that since the market rally has been driven by fewer sectors and narrow belt set of stocks, a diversified basket of portfolios has tended to underperform -- the more diversified [than the index] you have been, the higher the underperformance would have been," he says.