27.74 -1.23 (-4.44%) Buy

Don't go shopping for GDS now, it is underperforming the market

13 min read

GDS HOLDINGS LTD (Foreign) is a falling knife that can bleed you if you catch it today. It delivered -4.44% to close at 27.74. It's recent 5 day performance has been -1.89%, -6.06%, +6.82%, +0.68% and 0.0%.

[Themes containing GDS]

GDS showed a strong bearish trend over the last 3 months. During this period GDS delivered -19.36% and saw a maximum drawdown of -36.92%. There were 2 short signals during this period that returned a cumulative of +9.04% to investors.


GDS has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 9 Jun, 2017 to 14 Jun, 2018. Over the last 2 years 1 month and 5 day, GDS outperformed the SP500 index on 50% days. Which indicates that on days GDS outperforms the SP500 index, it's performance is marginally better than on the days it underperforms the SP500 index.

GDS returned losses on 54% days in the last three months. During this time, it delivered on average -0.24% per day. It delivered it's best daily return of +11.82%, during this period, on Tuesday, 13 Nov, 2018. The longest stort-term trend during this period was 8 losing days, which started on 1 Oct, 2018 and ended on 10 Oct, 2018. This bearish trend lost -37.85% of investor capital.

The last 12 months saw GDS's investors making profits in 7 months and incurring losses in 5 months. GDS was less consistent in delivering monthly returs than SP500 index. GDS significantly outperformed SP500 index in Aug 2018, when it returned +74.85% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. GDS had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.

"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.

GDS 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 fall in GDS's volatility from 10 Sep, 2018 to 28 Sep, 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 GDS has significant positive skewness in it's return distribution. This indicates that investors can expect GDS to recover from drawdowns quickly. Which makes GDS 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 GDS. Therefore, SP500 must receive a lower allocation than GDS in your portfolio. GDS usually has shorter drawdown period than the SP500 index.

Based on your interest in GDS you may find it interesting to know that EPIX and VIPS are highly volatile and therefore risky. Investors should consider limiting their exposure to these instruments (because of their volatile nature).

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