VMWARE, INC.

158.58 -2.78 (-1.75%) Buy

VMW investors herd to book profits while the going is good

13 min read

VMWARE, INC. delivered massive losses today. It fell by -1.75% to close at 158.58. During the last week it fell by -2.93% and saw a maximum drawdown of -3.6% before bouncing back.

[Themes containing VMW]

VMW is currently in a bullish trend. Over the last three months 2 bullish signals in VMW have generated a profit of +0.75% for investors.

Trend

VMW has been outperforming the SP500 index in recent time. It showed significant outperformance (compared to the SP500 index) from 2 Feb, 2016 to 11 Dec, 2018. Over the last 2 years 11 months and 10 days, VMW outperformed the SP500 index on 54% days.

During the last three months VMW delivered losses on 51% days. However, it still managed to end this period in a profit. It's best return during this period (of +4.97%) was on Wednesday, 28 Nov, 2018. While it's worst loss in the same period (of -4.06%) was on Wednesday, 24 Oct, 2018. The longest stort-term trends during this period were 4 profitable and losing days. The bullish trend (which returned +7.15%) started on 5 Nov, 2018 and went on till 8 Nov, 2018 while the bearish trend (which returned -9.95%) started on 8 Oct, 2018 and went on till 11 Oct, 2018.

During the last year VMW had 7 profitable months and 5 loss making months. VMW returned profits in fewer months than SP500 index. VMW significantly outperformed SP500 index in Nov 2018, when it returned +18.35% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. VMW had a shorter streak of profitable months than SP500 index. It only went up in 3 straight months during the last year.

"I am favor of cutting taxes under any circumstances and for any excuse, for any reason, whenever it's possible.

VMW 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 VMW's volatility from 4 Oct, 2018 to 6 Dec, 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 VMW has significant positive skewness in it's return distribution. This indicates that investors can expect VMW to recover from drawdowns quickly. Which makes VMW a good candidate for investing on short-term bullish trends or even counter-trends hoping for a pull-back.

Investors trading in VMW 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 VMW. Therefore, SP500 must receive a lower allocation than VMW in your portfolio. VMW usually has shorter drawdown period than the SP500 index.

Based on your interest in VMW you may find it interesting to know that AYTU, NSPR and APRN have all shown remarkable performance and qualify to be on every investor's watchlist.

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