Dycom Stock Volatility

DY Stock  USD 101.91  3.09  2.94%   
We consider Dycom Industries very steady. Dycom Industries secures Sharpe Ratio (or Efficiency) of 0.0157, which denotes the company had 0.0157% of return per unit of standard deviation over the last 3 months. Our philosophy in predicting the volatility of a stock is to use all available market data together with stock-specific technical indicators that cannot be diversified away. We have found twenty-eight technical indicators for Dycom Industries, which you can use to evaluate the future volatility of the firm. Please confirm Dycom Industries Downside Deviation of 2.07, mean deviation of 1.73, and Semi Deviation of 1.67 to check if the risk estimate we provide is consistent with the expected return of 0.0305%.
  
Dycom Industries Stock volatility depicts how high the prices fluctuate around the mean (or its average) price. In other words, it is a statistical measure of the distribution of Dycom daily returns, and it is calculated using variance and standard deviation. We also use Dycom's beta, its sensitivity to the market, as well as its odds of financial distress to provide a more practical estimation of Dycom Industries volatility.

300 Days Market Risk

Very steady

Chance of Distress

Very Low

300 Days Economic Sensitivity

Responds to the market
Since volatility provides investors with entry points to take advantage of stock prices, companies, such as Dycom Industries can benefit from it. Downward market volatility can be a perfect environment for investors who play the long game. Here, they may decide to buy additional stocks of Dycom Industries at lower prices. For example, an investor can purchase Dycom stock that has halved in price over a short period. This will lower your average cost per share, thereby improving your portfolio's performance when the markets normalize. Similarly, when the prices of Dycom Industries' stock rises, investors can sell out and invest the proceeds in other equities with better opportunities. Investing when markets are volatile with better valuations will accord both investors and companies the opportunity to generate better long-term returns.

Moving against Dycom Stock

-0.46WLMSWilliams Industrial Fiscal Quarter End 30th of June 2023 PairCorr

Dycom Industries Market Sensitivity And Downside Risk

Dycom Industries' beta coefficient measures the volatility of Dycom stock compared to the systematic risk of the entire stock market represented by your selected benchmark. In mathematical terms, beta represents the slope of the line through a regression of data points where each of these points represents Dycom stock's returns against your selected market. In other words, Dycom Industries's beta of 1.41 provides an investor with an approximation of how much risk Dycom Industries stock can potentially add to one of your existing portfolios.
Dycom Industries currently demonstrates below-average downside deviation. It has Information Ratio of 0.14 and Jensen Alpha of 0.4. However, we advise investors to further question Dycom Industries expected returns to ensure all indicators are consistent with the current outlook about its relatively low value at risk. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Dycom Industries' stock risk against market volatility during both bullish and bearish trends. The higher level of volatility that comes with bear markets can directly impact Dycom Industries' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
3 Months Beta |Analyze Dycom Industries Demand Trend
Check current 90 days Dycom Industries correlation with market (NYSE Composite)

Dycom Beta

    
  1.41  
Dycom standard deviation measures the daily dispersion of prices over your selected time horizon relative to its mean. Typical volatile equity has a high standard deviation, while the deviation of a stable instrument is usually low. As a downside, the standard deviation calculates all uncertainty as risk, even when it is in your favor, such as above-average returns.

Standard Deviation

    
  1.94  
It is essential to understand the difference between upside risk (as represented by Dycom Industries's standard deviation) and the downside risk, which can be measured by semi-deviation or downside deviation of Dycom Industries' daily returns or price. Since the actual investment returns on holding a position in dycom stock tend to have a non-normal distribution, there will be different probabilities for losses than for gains. The likelihood of losses is reflected in the downside risk of an investment in Dycom Industries.

Using Dycom Put Option to Manage Risk

Put options written on Dycom Industries grant holders of the option the right to sell a specified amount of Dycom Industries at a specified price within a specified time frame. The put buyer has a limited loss and, while not fully unlimited gains, as the price of Dycom Stock cannot fall below zero, the put buyer does gain as the price drops. So, one way investors can hedge Dycom Industries' position is by buying a put option against it. The put option used this way is usually referred to as insurance. If an undesired outcome occurs and loss on holding Dycom Industries will be realized, the loss incurred will be offset by the profits made with the option trade.

Dycom Industries' PUT expiring on 2023-06-16

   Profit   
       Dycom Industries Price At Expiration  

Current Dycom Industries Insurance Chain

DeltaGammaOpen IntExpirationCurrent SpreadLast Price
Put
2023-06-16 PUT at $115.0-0.86750.026422023-06-169.5 - 11.317.6View
Put
2023-06-16 PUT at $110.0-0.68450.0395122023-06-165.7 - 7.511.82View
Put
2023-06-16 PUT at $105.0-0.47480.0431132023-06-162.85 - 3.73.6View
Put
2023-06-16 PUT at $100.0-0.27550.0346722023-06-161.2 - 1.851.72View
Put
2023-06-16 PUT at $95.0-0.08920.01973992023-06-160.15 - 1.550.35View
Put
2023-06-16 PUT at $90.0-0.06960.011610252023-06-160.15 - 0.650.37View
Put
2023-06-16 PUT at $85.0-0.0430.0067572023-06-160.0 - 0.350.25View
Put
2023-06-16 PUT at $80.0-0.03050.0043522023-06-160.05 - 0.20.2View
Put
2023-06-16 PUT at $70.0-0.01070.00151942023-06-160.05 - 0.10.08View
View All Dycom Industries Options

Dycom Industries Stock Volatility Analysis

Volatility refers to the frequency at which Dycom Industries stock price increases or decreases within a specified period. These fluctuations usually indicate the level of risk that's associated with Dycom Industries' price changes. Investors will then calculate the volatility of Dycom Industries' stock to predict their future moves. A stock that has erratic price changes quickly hits new highs, and lows are considered highly volatile. A stock with relatively stable price changes has low volatility. A highly volatile stock is riskier, but the risk cuts both ways. Investing in highly volatile security can either be highly successful, or you may experience significant failure. There are two main types of Dycom Industries' volatility:

Historical Volatility

This type of stock volatility measures Dycom Industries' fluctuations based on previous trends. It's commonly used to predict Dycom Industries' future behavior based on its past. However, it cannot conclusively determine the future direction of the stock.

Implied Volatility

This type of volatility provides a positive outlook on future price fluctuations for Dycom Industries' current market price. This means that the stock will return to its initially predicted market price. This type of volatility can be derived from derivative instruments written on Dycom Industries' to be redeemed at a future date.
Transformation
The output start index for this execution was zero with a total number of output elements of sixty-one. Dycom Industries Average Price is the average of the sum of open, high, low and close daily prices of a bar. It can be used to smooth an indicator that normally takes just the closing price as input.
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Dycom Industries Projected Return Density Against Market

Allowing for the 90-day total investment horizon the stock has the beta coefficient of 1.405 suggesting as the benchmark fluctuates upward, the company is expected to outperform it on average. However, if the benchmark returns are projected to be negative, Dycom Industries will likely underperform.
Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Dycom Industries or Construction & Engineering sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Dycom Industries' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Dycom stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision.
The company has an alpha of 0.4032, implying that it can generate a 0.4 percent excess return over NYSE Composite after adjusting for the inherited market risk (beta).
   Predicted Return Density   
       Returns  
Dycom Industries' volatility is measured either by using standard deviation or beta. Standard deviation will reflect the average amount of how dycom stock's price will differ from the mean after some time.To get its calculation, you should first determine the mean price during the specified period then subtract that from each price point.

What Drives a Dycom Industries Price Volatility?

Several factors can influence a stock's market volatility:

Industry

Specific events can influence volatility within a particular industry. For instance, a significant weather upheaval in a crucial oil-production site may cause oil prices to increase in the oil sector. The direct result will be the rise in the stock price of oil distribution companies. Similarly, any government regulation in a specific industry could negatively influence stock prices due to increased regulations on compliance that may impact the company's future earnings and growth.

Political and Economic environment

When governments make significant decisions regarding trade agreements, policies, and legislation regarding specific industries, they will influence stock prices. Everything from speeches to elections may influence investors, who can directly influence the stock prices in any particular industry. The prevailing economic situation also plays a significant role in stock prices. When the economy is doing well, investors will have a positive reaction and hence, better stock prices and vice versa.

The Company's Performance

Sometimes volatility will only affect an individual company. For example, a revolutionary product launch or strong earnings report may attract many investors to purchase the company. This positive attention will raise the company's stock price. In contrast, product recalls and data breaches may negatively influence a company's stock prices.

Dycom Industries Stock Risk Measures

Most traded equities are subject to two types of risk - systematic (i.e., market) and unsystematic (i.e., nonmarket or company-specific) risk. Unsystematic risk is the risk that events specific to Dycom Industries or Construction & Engineering sector will adversely affect the stock's price. This type of risk can be diversified away by owning several different stocks in different industries whose stock prices have shown a small correlation to each other. On the other hand, systematic risk is the risk that Dycom Industries' price will be affected by overall stock market movements and cannot be diversified away. So, no matter how many positions you have, you cannot eliminate market risk. However, you can measure a Dycom stock's historical response to market movements and buy it if you are comfortable with its volatility direction. Beta and standard deviation are two commonly used measures to help you make the right decision. Allowing for the 90-day total investment horizon the coefficient of variation of Dycom Industries is 6363.99. The daily returns are distributed with a variance of 3.76 and standard deviation of 1.94. The mean deviation of Dycom Industries is currently at 1.53. For similar time horizon, the selected benchmark (NYSE Composite) has volatility of 0.9
α
Alpha over NYSE Composite
0.40
β
Beta against NYSE Composite1.41
σ
Overall volatility
1.94
Ir
Information ratio 0.14

Dycom Industries Stock Return Volatility

Dycom Industries historical daily return volatility represents how much of Dycom Industries stock's daily returns swing around its mean - it is a statistical measure of its dispersion of returns. The company accepts 1.9389% volatility on return distribution over the 90 days horizon. By contrast, NYSE Composite accepts 0.9046% volatility on return distribution over the 90 days horizon.
 Performance (%) 
       Timeline  

About Dycom Industries Volatility

Volatility is a rate at which the price of Dycom Industries or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Dycom Industries may increase or decrease. In other words, similar to Dycom's beta indicator, it measures the risk of Dycom Industries and helps estimate the fluctuations that may happen in a short period of time. So if prices of Dycom Industries fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility.
Please read more on our technical analysis page.
Last ReportedProjected for 2023
Market Capitalization2.7 BB
Dycom Industries' stock volatility refers to the amount of uncertainty or risk involved with the size of changes in its stock's price. It is a statistical measure of the dispersion of returns on Dycom Stock over a specified period of time, often expressed as the standard deviation of daily returns. In other words, it measures how much Dycom Industries' price varies over time.

3 ways to utilize Dycom Industries' volatility to invest better

Higher Dycom Industries' stock volatility means that the price of its stock is changing rapidly and unpredictably, while lower stock volatility indicates that the price of Dycom Industries stock is relatively stable. Investors and traders use stock volatility as an indicator of risk and potential reward, as stocks with higher volatility can offer the potential for more significant returns but also come with a greater risk of losses. Dycom Industries stock volatility can provide helpful information for making investment decisions in the following ways:
  • Measuring Risk: Volatility can be used as a measure of risk, which can help you determine the potential fluctuations in the value of Dycom Industries investment. A higher volatility means higher risk and potentially larger changes in value.
  • Identifying Opportunities: High volatility in Dycom Industries' stock can indicate that there is potential for significant price movements, either up or down, which could present investment opportunities.
  • Diversification: Understanding how the volatility of Dycom Industries' stock relates to your other investments can help you create a well-diversified portfolio of assets with varying levels of risk.
Remember it's essential to remember that stock volatility is just one of many factors to consider when making investment decisions, and it should be used in conjunction with other fundamental and technical analysis tools.

Dycom Industries Investment Opportunity

Dycom Industries has a volatility of 1.94 and is 2.16 times more volatile than NYSE Composite. 16  of all equities and portfolios are less risky than Dycom Industries. Compared to the overall equity markets, volatility of historical daily returns of Dycom Industries is lower than 16 () of all global equities and portfolios over the last 90 days. Use Dycom Industries to protect your portfolios against small market fluctuations. Benchmarks are essential to demonstrate the utility of optimization algorithms. The stock experiences an unexpected downward movement. The market is reacting to new fundamentals. Check odds of Dycom Industries to be traded at $97.83 in 90 days.

Very weak diversification

The correlation between Dycom Industries and NYA is 0.47 (i.e., Very weak diversification) for selected investment horizon. Overlapping area represents the amount of risk that can be diversified away by holding Dycom Industries and NYA in the same portfolio, assuming nothing else is changed.

Dycom Industries Additional Risk Indicators

The analysis of Dycom Industries' secondary risk indicators is one of the essential steps in making a buy or sell decision. The process involves identifying the amount of risk involved in Dycom Industries' investment and either accepting that risk or mitigating it. Along with some common measures of Dycom Industries stock's risk such as standard deviation, beta, or value at risk, we also provide a set of secondary indicators that can assist in the individual investment decision or help in hedging the risk of your existing portfolios.
Please note, the risk measures we provide can be used independently or collectively to perform a risk assessment. When comparing two potential stocks, we recommend comparing similar stocks with homogenous growth potential and valuation from related markets to determine which investment holds the most risk.

Dycom Industries Suggested Diversification Pairs

Pair trading is one of the very effective strategies used by professional day traders and hedge funds capitalizing on short-time and mid-term market inefficiencies. The approach is based on the fact that the ratio of prices of two correlating shares is long-term stable and oscillates around the average value. If the correlation ratio comes outside the common area, you can speculate with a high success rate that the ratio will return to the mean value and collect a profit.
The effect of pair diversification on risk is to reduce it, but we should note this doesn't apply to all risk types. When we trade pairs against Dycom Industries as a counterpart, there is always some inherent risk that will never be diversified away no matter what. This volatility limits the effect of tactical diversification using pair trading. Dycom Industries' systematic risk is the inherent uncertainty of the entire market, and therefore cannot be mitigated even by pair-trading it against the equity that is not highly correlated to it. On the other hand, Dycom Industries' unsystematic risk describes the types of risk that we can protect against, at least to some degree, by selecting a matching pair that is not perfectly correlated to Dycom Industries.
Check out Investing Opportunities to better understand how to build diversified portfolios. For more information on how to buy Dycom Stock please use our How to Invest in Dycom Industries guide. You can also try Equity Analysis module to research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities.

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Is Dycom Industries' industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Dycom Industries. If investors know Dycom will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Dycom Industries listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
1.662
Earnings Share
5.86
Revenue Per Share
134.915
Quarterly Revenue Growth
0.193
Return On Assets
0.0727
The market value of Dycom Industries is measured differently than its book value, which is the value of Dycom that is recorded on the company's balance sheet. Investors also form their own opinion of Dycom Industries' value that differs from its market value or its book value, called intrinsic value, which is Dycom Industries' true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Dycom Industries' market value can be influenced by many factors that don't directly affect Dycom Industries' underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Dycom Industries' value and its price as these two are different measures arrived at by different means. Investors typically determine if Dycom Industries is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Dycom Industries' price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party. Check out Investing Opportunities to better understand how to build diversified portfolios. For more information on how to buy Dycom Stock please use our How to Invest in Dycom Industries guide.