Profit booking on the minds of DQ investors as it ranks better than it's peers but, has not managed to breakout
13 Dec, 201813 min read
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DQ delivered stellar performance today. On a longer term basis, investors in DAQO NEW ENERGY CORP. (Foreign) made +0.21% per day. Thursday's performance of +0.59% was a significant outperformance compared to it's daily average.
Buy-and-Hold investors in DQ experienced a maximum drawdown of -32.23% over the last three months. It lost -17.27% during this strong down trending period. There were both Long and Short signals during this period, where the short signals were significantly more profitable than the long signals. The net profit from Short signals was +13.72%.
DQ has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 9 days, DQ outperformed the SP500 index on 50% days. Which indicates that on days DQ outperforms the SP500 index, it's performance is marginally better than on the days it underperforms the SP500 index.
DQ returned losses on 53% days in the last three months. During this time, it delivered on average -0.19% per day. It delivered it's worst daily return of -14.28%, during this period, on Tuesday, 13 Nov, 2018. There was initially a bearish trend during this period which started on 4 Oct, 2018 and went on till 11 Oct, 2018. The trend delivered -11.29% losses to investors. This was followed by a bullish trend that started on 30 Oct, 2018 and ended on 7 Nov, 2018. This bullish trend delivered +30.52% to investors.
DQ had 4 profitable and 8 loss making months over the last year. During the last year, DQ underperformed SP500 index on monthly return basis. DQ was also a more risky investment than SP500 index as it's worst month in the last year, Jun 2018, returned -38.36% compared to -7.28% returned by SP500 index in Oct 2018. DQ had a longer winning streak of losing months than SP500 index. It went down in 3 straight months (from Jan 2018 to Mar 2018) during which period it delivered -23.12%.
"You have venture capitalists. We view them as experts who also help finance your company and give directions and also some pretty candid discussions about what you have to do better.
DQ 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 DQ's volatility from 14 Sep, 2018 to 25 Sep, 2018. While there was a significant surge in the SP500 index's volatility from 14 Sep, 2018 to 29 Oct, 2018.
Advanced/professional short-term investors should note that DQ 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.
SP500 index has more chance of extreme outcomes than DQ. Therefore, SP500 must receive a lower allocation than DQ in your portfolio. SP500 index usually has shorter drawdown period than DQ.
Based on your interest in DQ you may find it interesting to know that HEAR and NIHD have both shown remarkable performance this year and deserve to be on every investors' watchlist.
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