CWT investors make good profits
07 Dec, 201813 min read
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CALIFORNIA WATER SERVICE GROUP outperformed the broader market on Friday. It increased by +1.37% to close at 45.91. On a day when the overall market breadth was 35%, it closed higher than 9% of the market. In comparison, the benchmark SP500 index closed today at -0.0233%.
CWT is currently in a bullish trend. The current bullish signal has generated a profit of +10.23% for CWT's investors in the last three months.
CWT has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 4 Jan, 2016 to 7 Dec, 2018. One must note that CWT is currently at it's peak outperformance to the SP500 index which makes it a good investment candidate. Over the last 2 years 11 months and 3 days, CWT outperformed the SP500 index on 53% days.
During the last three months CWT delivered losses on 51% days. However, it still managed to end this period in a profit. It's best return during this period (of +3.85%) was on Thursday, 6 Dec, 2018. While it's worst loss in the same period (of -3.9%) was on Tuesday, 4 Dec, 2018. The longest stort-term trends during this period were 4 profitable and losing days. The bullish trend (which returned +6.99%) started on 2 Nov, 2018 and went on till 7 Nov, 2018 while the bearish trend (which returned -5.03%) started on 10 Oct, 2018 and went on till 15 Oct, 2018.
During the last year CWT had 7 profitable months and 5 loss making months. CWT returned profits in fewer months than SP500 index. CWT was also a more risky investment than SP500 index as it's worst month in the last year, Jan 2018, returned -8.95% compared to -7.28% returned by SP500 index in Oct 2018. CWT had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year. It is interesting to note that both CWT and SP500 index significantly outperform during months when quarterly/annual results are announced.
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CWT is currently seeing overall increase in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in CWT's volatility from 12 Sep, 2018 to 31 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 10 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that CWT has significant positive skewness in it's return distribution. This indicates that investors can expect CWT to recover from drawdowns quickly. Which makes CWT a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.
SP500 index has more chance of extreme outcomes than CWT. Therefore, SP500 must receive a lower allocation than CWT in your portfolio. SP500 index usually has shorter drawdown period than CWT.
Based on your interest in CWT you may find it interesting to know that PFE, CSCO and MSFT are large caps that have all shown remarkable performance and qualify to be on every investor's watchlist.
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