180.35 -3.77 (-2.09%) Buy

DLF investors re-evaluating their investment strategy

13 min read

DLF LIMITED ranked among the worst performers today. It fell by -2.09% to close at 180.35. It's recent 5 day performance has been +0.68%, -1.61%, +2.65%, -0.55% and -0.76%.

[Themes containing DLF]

DLF is currently in a bullish trend. The current bullish signal has generated a profit of +4.95% for DLF's investors in the last three months.


DLF has been underperforming the NIFTY-50 index in recent time. It showed significant outperformance (compared to the NIFTY-50 index) from 12 Feb, 2016 to 11 Jan, 2018. Over the last 3 years and 1 month, DLF outperformed the NIFTY-50 index on 50% days. Which indicates that on days DLF 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 DLF delivered losses on 53% days. However, it still managed to end this period in a profit. It's best return during this period (of +7.55%) was on Wednesday, 19 Dec, 2018. While it's worst loss in the same period (of -5.42%) was on Thursday, 6 Dec, 2018. The longest stort-term trends during this period were 5 profitable and losing days. The bullish trend (which returned +6.3%) started on 4 Jan, 2019 and went on till 10 Jan, 2019 while the bearish trend (which returned -8.5%) started on 20 Dec, 2018 and went on till 27 Dec, 2018.

During the last year DLF had 6 profitable months and 6 loss making months. DLF returned profits in more months than NIFTY-50 index. DLF was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -26.11% compared to -6.42% returned by NIFTY-50 index in Sep 2018. DLF and NIFTY-50 index, both had periods of 2 consecutive profitable months. It is interesting to note that both DLF and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.

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DLF 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 DLF's volatility from 19 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 DLF has significant positive skewness in it's return distribution. This indicates that investors can expect DLF to recover from drawdowns quickly. Which makes DLF a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

Investors trading in DLF derivatives at this moment can consider 'Married Call' options strategy to receive better risk-adjusted returns.

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

Based on your interest in DLF you may find it interesting to know that SRIPIPES is highly volatile and investors investing in it must take extreme caution. Consider either reducing your exposure to SRIPIPES or sufficiently diversifying your portfolio.

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