17.6 -0.77 (-4.35%) Buy

Search for alternative investments is on for DHANBANK investors as it shows weakness

13 min read

DHANLAXMI BANK LIMITED was among the worst performers on Friday. It delivered -4.35% to close at 17.6. It is currently trading -40% below it's 52 week high of 29.65.

[Themes containing DHANBANK]

Buy-and-Hold investors in DHANBANK experienced a maximum drawdown of -18.43% over the last three months. It surged by +51.07% during this strong bullish trending period. There were both Long and Short signals during this period, while the long signals were significantly more profitable than the short signals. The net profit from Long signals was +17.33%.


DHANBANK has been outperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 4 May, 2017 to 28 Sep, 2018. Over the last 3 years and 1 month, DHANBANK underperformed the NIFTY-50 index on 57% days.

DHANBANK returned losses on 54% days in the last three months. During this time, it delivered on average +0.72% per day. It delivered it's best daily return of +15.38%, during this period, on Wednesday, 31 Oct, 2018. The longest stort-term trend during this period was 9 profitable days, which started on 26 Oct, 2018 and went on till 7 Nov, 2018. This bullish trend returned +53.36% to investors.

The last 12 months saw DHANBANK's investors making profits in 4 months and incurring losses in 8 months. DHANBANK was less consistent in delivering monthly returs than NIFTY-50 index. DHANBANK was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -27.83% compared to -6.42% returned by NIFTY-50 index in Sep 2018. DHANBANK had a longer winning streak of losing months than NIFTY-50 index. It went down in 5 straight months (from Feb 2018 to Jun 2018) during which period it delivered -38.49%. It is interesting to note that both DHANBANK and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

If you totally want to reduce risk, take no risk. Bury the money. Then you've got no risk at all.
-- Don Connelly

DHANBANK is currently seeing overall increase in volatility. In comparison, the NIFTY-50 index is seeing decrease in volatility. During the last three months, there was a significant fall in DHANBANK's volatility from 30 Oct, 2018 to 10 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 DHANBANK has significant negative skewness in it's return distribution. This indicates that DHANBANK is very risky for short-term investment and can significantly underperform for long durations.

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

Based on your interest in DHANBANK you may find it interesting to know that ~MKTCAP201TO250 and ~CHEMICALS have both shown remarkable performance and deserve to be on every investors' watchlist.

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