DCM SHRIRAM LIMITED

346.1 -4.05 (-1.17%) Buy

DCMSHRIRAM investors not showing any loss of confidence as it pauses to catch its breath

13 min read

DCMSHRIRAM delivered lacklustre performance today. On a longer term basis, investors in DCM SHRIRAM LIMITED made +0.15% per day. Friday's performance of -1.17% was a significant underperformance compared to it's daily average.

[Themes containing DCMSHRIRAM]

Buy-and-Hold investors in DCMSHRIRAM experienced a maximum drawdown of -22.34% over the last three months. It lost -12.88% 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.

Trend

DCMSHRIRAM has been underperforming the NIFTY-50 index in recent time, after having outperformed till 19 Dec, 2017. Over the last 3 years and 1 month, DCMSHRIRAM outperformed the NIFTY-50 index on 50% days. Which indicates that on days DCMSHRIRAM outperforms the NIFTY-50 index, it's performance is marginally better than on the days it underperforms the NIFTY-50 index.

During the last three months DCMSHRIRAM was mostly loss making and delivered on average -0.19% per day. It's best return during this period (of +6.74%) was on Friday, 26 Oct, 2018. While it's worst loss in the same period (of -5.7%) was on Thursday, 25 Oct, 2018. There was initially a bearish trend during this period which started on 13 Nov, 2018 and went on till 26 Nov, 2018. The trend delivered -21.15% losses to investors. This was followed by a bullish trend that started on 4 Jan, 2019 and ended on 9 Jan, 2019. This bullish trend delivered +5.17% to investors.

DCMSHRIRAM had 5 profitable and 7 loss making months over the last year. During the last year, number of profitable months of DCMSHRIRAM and NIFTY-50 index were the same. DCMSHRIRAM was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Apr 2018, returned -26.19% compared to -6.42% returned by NIFTY-50 index in Sep 2018. DCMSHRIRAM had a longer winning streak of profitable months than NIFTY-50 index. It went up in 4 straight months (from Jun 2018 to Sep 2018) during which period it delivered +48.0%. It is interesting to note that both DCMSHRIRAM and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

If all the economists were laid end to end, they'd never reach a conclusion.
-- George Bernard Shaw

DCMSHRIRAM is becoming less volatile overall. In comparison, the NIFTY-50 index is seeing a fall in volatility. During the last three months, there was a significant fall in DCMSHRIRAM's volatility from 19 Oct, 2018 to 16 Jan, 2019. While there was a significant fall in the NIFTY-50 index's volatility from 31 Oct, 2018 to 5 Dec, 2018.

Advanced/professional short-term investors should note that DCMSHRIRAM has negative skewness in it's return distribution. This indicates that investors may need to stay invested through long periods of drawdown before expecting a recovery.

DCMSHRIRAM has more chance of extreme outcomes than the NIFTY-50 index. Therefore, DCMSHRIRAM must receive a lower allocation than NIFTY-50 in your portfolio. NIFTY-50 index usually has shorter drawdown period than DCMSHRIRAM.

On a general note (since you are interested in DCMSHRIRAM), three large cap instruments that deserve special mention are BRITANNIA, INFY and TCS. They have all outperformed the market and must be closely watched for investment opportunities.

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