DPSC LIMITED was among the worst performers on Friday. It fell by -3.23% to close at 13.5. On a day when the overall market breadth was 71%, it closed higher than 41% of the market. In comparison, the benchmark NIFTY-50 index closed today at +0.02%.
DPSCLTD showed a bullish trend over the last 3 months. During this period DPSCLTD delivered +4.65% and saw a maximum drawdown of -18.73%. It has been unusually choppy during this period. Long term investors are better off avoiding investing in DPSCLTD till volatility reduces and a clear trend emerges.
DPSCLTD has been outperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 3 Apr, 2017 to 30 Nov, 2018. Over the last 3 years and 1 month, DPSCLTD underperformed the NIFTY-50 index on 49% days. Which indicates that on days DPSCLTD 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 DPSCLTD delivered losses on 53% days. However, it still managed to end this period in a profit. It's best return during this period (of +7.69%) was on Thursday, 13 Dec, 2018. While it's worst loss in the same period (of -9.09%) was on Friday, 30 Nov, 2018. The longest stort-term trend during this period was 5 profitable days, which started on 28 Dec, 2018 and went on till 3 Jan, 2019. This bullish trend returned +6.39% to investors.
During the last year DPSCLTD had 4 profitable months and 8 loss making months. DPSCLTD returned profits in fewer months than NIFTY-50 index. DPSCLTD was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Sep 2018, returned -23.44% compared to -6.42% returned by NIFTY-50 index in Sep 2018. DPSCLTD had a longer winning streak of losing months than NIFTY-50 index. It went down in 6 straight months (from Jun 2018 to Nov 2018) during which period it delivered -85.43%. It is interesting to note that both DPSCLTD and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
"Derivatives are financial weapons of mass destruction.
DPSCLTD 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 DPSCLTD's volatility from 19 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 DPSCLTD 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 DPSCLTD. Therefore, NIFTY-50 must receive a lower allocation than DPSCLTD in your portfolio. NIFTY-50 index usually has shorter drawdown period than DPSCLTD.
Based on your interest in DPSCLTD you may find it interesting to know that LTTS has shown remarkable performance this year and deserves to be on every investors' watchlist.
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