SEMTECH CORP

47.6 +0.8 (+1.69%) Buy

SMTC investors make good profits

13 min read

SMTC was among the best performers today. On a longer term basis, investors in SEMTECH CORP made -0.01% per day. Tuesday's performance of +1.69% was a significant outperformance compared to it's daily average.

[Themes containing SMTC]

Buy-and-Hold investors in SMTC experienced a maximum drawdown of -28.41% over the last three months. It lost -19.12% 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 +8.22%.

Trend

SMTC has been outperforming the SP500 index in recent time. Over the last 2 years 11 months and 7 days, SMTC outperformed the SP500 index on 53% days.

During the last three months SMTC was mostly loss making and delivered on average -0.29% per day. It's best return during this period (of +7.62%) was on Thursday, 29 Nov, 2018. While it's worst loss in the same period (of -10.69%) was on Wednesday, 24 Oct, 2018. There was initially a bearish trend during this period which started on 19 Sep, 2018 and went on till 26 Sep, 2018. The trend delivered -7.65% 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 +9.58% to investors.

SMTC had 6 profitable and 6 loss making months over the last year. During the last year, SMTC underperformed SP500 index on monthly return basis. SMTC significantly outperformed SP500 index in Aug 2018, when it returned +25.92% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. SMTC had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year.

I would not pre-pay. I would invest instead and let the investments cover it.
-- Dave Ramsey

SMTC is becoming more volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant surge in SMTC's volatility from 19 Sep, 2018 to 7 Dec, 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 SMTC has significant positive skewness in it's return distribution. This indicates that investors can expect SMTC to recover from drawdowns quickly. Which makes SMTC 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 SMTC. Therefore, SP500 must receive a lower allocation than SMTC in your portfolio. SP500 index usually has shorter drawdown period than SMTC.

Based on your interest in SMTC you may find it interesting to know that IMTE is highly volatile and investors investing in it must take extreme caution. Consider either reducing your exposure to IMTE or sufficiently diversifying your portfolio.

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