VECTREN CORP

71.84 -0.04 (-0.06%) Buy

VVC investors not showing any loss of confidence as it pauses to catch its breath

13 min read

VECTREN CORP ranked worse than it's peers on Friday. It lost -0.06% to close at 71.84. On a day when the overall market breadth was 35%, it closed higher than 8% of the market. In comparison, the benchmark SP500 index closed today at -0.0233%.

[Themes containing VVC]

Buy-and-Hold investors in VVC experienced a maximum drawdown of -0.71% over the last three months. It returned +0.8% during this flat trending period. There were both Long and Short signals during this period, while the long signals were marginally more profitable than the short signals.

Trend

VVC has been outperforming the SP500 index in recent time. VVC is currently at it's peak outperformance to the SP500 index and can be considered for investment. Over the last 2 years 11 months and 3 days, VVC outperformed the SP500 index on 54% days.

During the last three months VVC was mostly profitable and delivered on average +0.01% per day. It's best return during this period (of +0.59%) was on Friday, 16 Nov, 2018. While it's worst loss in the same period (of -0.71%) was on Wednesday, 14 Nov, 2018. There was initially a bullish trend during this period which started on 17 Sep, 2018 and went on till 21 Sep, 2018. The bullish trend returned +0.42% to investors. This was followed by a bearish trend that started on 9 Oct, 2018 and ended on 11 Oct, 2018. This bearish trend lost -0.46% of investor capital.

VVC had 7 profitable and 5 loss making months over the last year. During the last year, VVC underperformed SP500 index on monthly return basis. VVC significantly outperformed SP500 index in Apr 2018, when it returned +11.13% compared to +4.75% returned by SP500 index during it's best month in the last one year - Jan 2018. VVC had a shorter streak of profitable months than SP500 index. It only went up in 4 straight months during the last year.

Believe you can and you're halfway there.
-- Theodore Roosevelt

VVC is becoming less volatile overall. In comparison, the SP500 index is seeing a rise in volatility. During the last three months, there was a significant fall in VVC's volatility from 10 Sep, 2018 to 31 Oct, 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 VVC 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.

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

On a general note (since you are interested in VVC), two instruments that have delivered similar performance as VVC are ROIC and ANAT. They are suitable as good alternative investment candidates that can diversify your portfolio.

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