DDD is a falling knife, continues to bleed every investor trying to catch it
14 Dec, 201813 min read
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3D SYSTEMS CORP significantly underperformed on Friday. It delivered -4.32% to close at 10.63. It is currently trading -50% below it's 52 week high of 21.61.
DDD showed a strong bearish trend over the last 3 months. During this period DDD delivered -41.69% and saw a maximum drawdown of -45.79%. There was a short signal during this period which returned +36.46%.
DDD has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 16 May, 2017 to 14 Nov, 2017. Over the last 2 years 11 months and 10 days, DDD underperformed the SP500 index on 50% days. Which indicates that on days DDD underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.
During the last three months DDD was mostly loss making and delivered on average -0.72% per day. It's best return during this period (of +9.3%) was on Friday, 2 Nov, 2018. While it's worst loss in the same period (of -28.77%) was on Wednesday, 31 Oct, 2018. The longest stort-term trend during this period was 5 losing days, which started on 5 Oct, 2018 and ended on 11 Oct, 2018. This bearish trend lost -10.52% of investor capital.
The last 12 months saw DDD's investors making profits in 6 months and incurring losses in 6 months. DDD was less consistent in delivering monthly returs than SP500 index. DDD significantly outperformed SP500 index in Aug 2018, when it returned +67.21% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. DDD had a shorter streak of profitable months than SP500 index. It only went up in 2 straight months during the last year.
"After two decades of personal finance reporting, I've heard every excuse in the book for not saving money. That said, none of them really hold up - at least over the long term.
DDD is currently seeing overall fall in volatility. In comparison, the SP500 index is seeing increase in volatility. During the last three months, there was a significant surge in DDD's volatility from 17 Sep, 2018 to 30 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 25 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that DDD has significant negative skewness in it's return distribution. This indicates that DDD is very risky for short-term investment and can significantly underperform for long durations.
Investors trading in DDD derivatives at this moment can consider 'Married Put' options strategy to receive better risk-adjusted returns.
SP500 index has more chance of extreme outcomes than DDD. Therefore, SP500 must receive a lower allocation than DDD in your portfolio. SP500 index usually has shorter drawdown period than DDD.
Based on your interest in DDD you may find it interesting to know that EHC and KEYS are both small caps that have shown remarkable performance and deserve to be on every investors' watchlist.
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