SIEMENS LTD underperformed broader market on Friday. It fell by -0.94% to close at 1054.75. It is currently trading -20% below it's 52 week high of 1323.75.
Buy-and-Hold investors in SIEMENS experienced a maximum drawdown of -9.19% over the last three months. It increased by +20.65% 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 +1.8%.
SIEMENS has been outperforming the NIFTY-50 index in recent time. It showed significant underperformance (compared to the NIFTY-50 index) from 10 May, 2017 to 14 Sep, 2018. Over the last 3 years and 1 month, SIEMENS underperformed the NIFTY-50 index on 52% days.
During the last three months SIEMENS was mostly profitable and delivered on average +0.32% per day. It's best return during this period (of +5.31%) was on Thursday, 15 Nov, 2018. While it's worst loss in the same period (of -4.06%) was on Monday, 19 Nov, 2018. The longest stort-term trend during this period was 6 profitable days, which started on 29 Oct, 2018 and went on till 5 Nov, 2018. This bullish trend returned +12.06% to investors.
During the last year SIEMENS had 6 profitable months and 6 loss making months. SIEMENS returned profits in more months than NIFTY-50 index. SIEMENS was also a more risky investment than NIFTY-50 index as it's worst month in the last year, Feb 2018, returned -10.29% compared to -6.42% returned by NIFTY-50 index in Sep 2018. SIEMENS had a longer winning streak of profitable months than NIFTY-50 index. It went up in 3 straight months (from Nov 2018 to Jan 2019) during which period it delivered +12.9%. It is interesting to note that both SIEMENS and NIFTY-50 index significantly outperform during months when quarterly/annual results are announced.
Be quick in cutting your loses but not profits
-- Abhishek Shukla
SIEMENS 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 SIEMENS's volatility from 19 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 SIEMENS has significant positive skewness in it's return distribution. This indicates that investors can expect SIEMENS to recover from drawdowns quickly. Which makes SIEMENS a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.
Investors trading in SIEMENS derivatives at this moment can consider 'Married Call' options strategy to receive better risk-adjusted returns.
SIEMENS has more chance of extreme outcomes than the NIFTY-50 index. Therefore, SIEMENS must receive a lower allocation than NIFTY-50 in your portfolio. NIFTY-50 index usually has shorter drawdown period than SIEMENS.
Based on your interest in SIEMENS you may find it interesting to know that INFY and BAJFINANCE are both large caps that have shown remarkable performance and deserve to be on every investors' watchlist.
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