DORM continues to mint money for it's investors
12 Dec, 201813 min read
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DORM delivered good returns today. On a longer term basis, investors in DORMAN PRODUCTS, INC. made -0.03% per day. Wednesday's performance of +3.46% was a significant outperformance compared to it's daily average.
Buy-and-Hold investors in DORM experienced a maximum drawdown of -19.48% over the last three months. It grew by +5.69% during this up 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 +9.46%.
DORM has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 8 days, DORM outperformed the SP500 index on 51% days.
During the last three months DORM was mostly profitable and delivered on average +0.11% per day. It's best return during this period (of +7.66%) was on Friday, 26 Oct, 2018. While it's worst loss in the same period (of -5.31%) was on Wednesday, 10 Oct, 2018. There was initially a bearish trend during this period which started on 27 Sep, 2018 and went on till 5 Oct, 2018. The trend delivered -9.35% losses to investors. This was followed by a bullish trend that started on 30 Oct, 2018 and ended on 2 Nov, 2018. This bullish trend delivered +8.49% to investors.
On monthly basis, DORM delivered profits in more months over the last year, than losses. DORM delivered profits less regularly than SP500 index. DORM significantly outperformed SP500 index in Jan 2018, when it returned +20.94% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. DORM had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year. It is interesting to note that both DORM and SP500 index significantly outperform during months when quarterly/annual results are announced.
"The financial markets generally are unpredictable. So that one has to have different scenarios... The idea that you can actually predict what's going to happen contradicts my way of looking at the market.
DORM is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in DORM's volatility from 9 Oct, 2018 to 29 Oct, 2018. While there was a significant surge in the SP500 index's volatility from 13 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that DORM has significant positive skewness in it's return distribution. This indicates that investors can expect DORM to recover from drawdowns quickly. Which makes DORM 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 DORM. Therefore, SP500 must receive a lower allocation than DORM in your portfolio. SP500 index usually has shorter drawdown period than DORM.
On a general note (since you are interested in DORM), UNH is a large cap that deserves to be closely tracked for investment opportunities.
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