58.34 -0.52 (-0.88%) Sell

Doubt in the minds of DXC investors as it was among the worst performers

13 min read

DXC TECHNOLOGY CO has destroyed investor wealth on Tuesday. It fell by -0.88% to close at 58.34. It is currently trading -45% below it's 52 week high of 107.31.

[Themes containing DXC]

DXC is currently in a bearish trend. The current bearish signal has generated a profit of +35.88% for investors in the last three months.


DXC has been underperforming the SP500 index in recent time. It showed significant underperformance (compared to the SP500 index) from 20 Mar, 2018 to 20 Nov, 2018. Over the last 1 year 8 months and 8 days, DXC underperformed the SP500 index on 46% days. Which indicates that on days DXC underperforms the SP500 index, it's performance is marginally worse than on the days it outperforms the SP500 index.

During the last three months DXC was mostly loss making and delivered on average -0.69% per day. It's best return during this period (of +3.67%) was on Thursday, 25 Oct, 2018. While it's worst loss in the same period (of -16.34%) was on Wednesday, 24 Oct, 2018. The longest stort-term trend during this period was 6 losing days, which started on 4 Oct, 2018 and ended on 11 Oct, 2018. This bearish trend lost -8.62% of investor capital.

During the last year DXC had 6 profitable months and 6 loss making months. DXC returned profits in fewer months than SP500 index. DXC was also a more risky investment than SP500 index as it's worst month in the last year, Oct 2018, returned -22.43% compared to -7.28% returned by SP500 index in Oct 2018. DXC 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 DXC and SP500 index significantly outperform during months when quarterly/annual results are announced.

The habit of saving is itself an education; it fosters every virtue, teaches self-denial, cultivates the sense of order, trains to forethought, and so broadens the mind.
-- T.T. Munger

DXC 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 DXC's volatility from 19 Sep, 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 DXC has significant positive skewness in it's return distribution. This indicates that investors can expect DXC to recover from drawdowns quickly. Which makes DXC 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 DXC. Therefore, SP500 must receive a lower allocation than DXC in your portfolio. DXC usually has shorter drawdown period than the SP500 index.

On a general note (since you are interested in DXC), two large cap instruments that deserve special mention are AMZN and V. They have significantly outperformed the overall market.

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