61.43 -1.27 (-2.07%) Sell

Doubt in the minds of NTAP investors as it significantly underperforms

13 min read

NETAPP, INC. delivered massive losses on Friday. It fell by -2.07% to close at 61.43. It is currently trading -30% below it's 52 week high of 87.92.

[Themes containing NTAP]

NTAP is currently in a bearish trend. Over the last three months 2 bearish signals have generated a profit of +21.5% for investors.


NTAP has been underperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 5 May, 2016 to 4 Sep, 2018. Over the last 2 years 11 months and 10 days, NTAP outperformed the SP500 index on 54% days.

NTAP returned losses on 56% days in the last three months. During this time, it delivered on average -0.44% per day. It delivered it's worst daily return of -11.73%, during this period, on Thursday, 15 Nov, 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 -14.57% of investor capital.

During the last year NTAP had 6 profitable months and 6 loss making months. NTAP returned profits in fewer months than SP500 index. NTAP significantly outperformed SP500 index in Jun 2018, when it returned +14.94% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. NTAP 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 NTAP and SP500 index significantly outperform during months when quarterly/annual results are announced.

"Once my ears were open to hearing mentions of 'Shark Tank', I was surprised by how many people in our world, even in our industry, tech and finance, loved the show.

NTAP 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 NTAP's volatility from 2 Oct, 2018 to 20 Nov, 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 NTAP 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.

Investors trading in NTAP derivatives at this moment can consider 'Covered Call' options strategy to receive better risk-adjusted returns.

SP500 index has more chance of extreme outcomes than NTAP. Therefore, SP500 must receive a lower allocation than NTAP in your portfolio. SP500 index usually has shorter drawdown period than NTAP.

Based on your interest in NTAP you may find it interesting to know that NFEC, HEAR and I have all shown remarkable performance this year and deserve to be on every investor's watchlist.

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