DHANUKA AGRITECH LTD

415.1 -2.09 (-0.5%) Sell

Don't buy DHANUKA now, it is underperforming the market

13 min read

DHANUKA AGRITECH LTD showed weakness on Friday. It fell by -0.5% to close at 415.1. On a day when the overall market breadth was 71%, it closed higher than 35% of the market. In comparison, the benchmark NIFTY-50 index closed today at +0.02%.

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DHANUKA showed a bullish trend over the last 3 months. During this period DHANUKA increased by +2.49% and saw a maximum drawdown of -12.37%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in DHANUKA till volatility reduces and a clear trend emerges.

Trend

DHANUKA has been underperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 2 May, 2017 to 1 Oct, 2018. Over the last 3 years and 1 month, DHANUKA underperformed the NIFTY-50 index on 48% days. Which indicates that on days DHANUKA underperforms the NIFTY-50 index, it's performance is marginally worse than on the days it outperforms the NIFTY-50 index.

During the last three months DHANUKA delivered losses on 51% days. However, it still managed to end this period in a profit. It's best return during this period (of +5.88%) was on Friday, 2 Nov, 2018. While it's worst loss in the same period (of -4.91%) was on Monday, 22 Oct, 2018. The longest stort-term trend during this period was 8 profitable days, which started on 1 Nov, 2018 and went on till 13 Nov, 2018. This bullish trend returned +14.98% to investors.

During the last year DHANUKA had 4 profitable months and 8 loss making months. DHANUKA returned profits in fewer months than NIFTY-50 index. DHANUKA was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -26.35% compared to -6.42% returned by NIFTY-50 index in Sep 2018. DHANUKA had a longer winning streak of losing months than NIFTY-50 index. It went down in 3 straight months (from Aug 2018 to Oct 2018) during which period it delivered -35.52%.

Empty pockets never held anyone back. Only empty heads and empty hearts can do that.
-- Norman Vincent Peale

DHANUKA 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 DHANUKA's volatility from 22 Oct, 2018 to 18 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 DHANUKA 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.

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

Based on your interest in DHANUKA you may find it interesting to know that HATSUN, SRIPIPES and IGARASHI are all extremely risky investment candidates that must be evaluated carefully. Investors with low risk profile are better off avoiding them till their performance becomes more consistent.

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