DCW is a falling knife that can bleed you if you catch it today. On a longer term basis, investors in DCW LTD made +0.03% per day. Friday's performance of -1.95% was a underperformance compared to it's daily average.
DCW showed a flat trend over the last 3 months. During this period DCW delivered +0.86% and saw a maximum drawdown of -21.66%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in DCW till volatility reduces and a clear trend emerges.
DCW has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 27 Oct, 2017 to 18 Jan, 2019. One must note that DCW is currently at it's worst performance to the NIFTY-50 index which makes it a bad investment candidate. Over the last 3 years and 1 month, DCW underperformed the NIFTY-50 index on 55% days.
DCW returned losses on 59% days in the last three months. During this time, it delivered on average +0.04% per day. It delivered it's worst daily return of -7.6%, during this period, on Friday, 16 Nov, 2018. The longest stort-term trend during this period was 9 losing days, which started on 26 Nov, 2018 and ended on 6 Dec, 2018. This bearish trend lost -12.68% of investor capital.
During the last year DCW had 4 profitable months and 8 loss making months. DCW returned profits in fewer months than NIFTY-50 index. DCW was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -28.27% compared to -6.42% returned by NIFTY-50 index in Sep 2018. DCW had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from May 2018 to Jul 2018) during which period it delivered -35.57%. It is interesting to note that both DCW and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
Buy when everyone else is selling and hold until everyone else is buying. That's not just a catchy slogan. It's the very essence of successful investing.
-- J. Paul Getty
DCW is currently seeing overall fall in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant fall in DCW's volatility from 22 Oct, 2018 to 17 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 DCW has significant negative skewness in it's return distribution. This indicates that DCW is very risky for short-term investment and can significantly underperform for long durations.
DCW has more chance of extreme outcomes than the NIFTY-50 index. Therefore, DCW must receive a lower allocation than NIFTY-50 in your portfolio. NIFTY-50 index usually has shorter drawdown period than DCW.
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