Question
Suppose we are examining 500 trading days data for Asset XYZ during 2016-2017. Suppose we find out, in 2016, there are 10 days that XYZs
Suppose we are examining 500 trading days data for Asset XYZ during 2016-2017. Suppose we find out, in 2016, there are 10 days that XYZs stock price is traded below 50; in 2017, there are 5 days that XYZs stock price is traded below 50. Among those incidents of price below 50, we find that:
The occurrences of the price staying below 50 for consecutively 1 day = 6
The occurrences of the price staying below 50 for consecutively 2 days = 4
The occurrences of the price staying below 50 for consecutively 3 days = 3
The occurrences of the price staying below 50 for consecutively 4 days = 2
Which one of the following statements is WRONG?
- It is more likely that the price drops below 50 in one day and quickly jump high above 50 the next day, than staying below 50 for consecutive 3 days.
- It is more likely that the price stays below 50 for consecutive 2 days, than staying below 50 for consecutive 4 days.
- Among all the cases where the stock price drops below 50, the occurrences of the price staying below 50 for consecutively 4 days account for roughly 13 %
- Among all the 500 trading days, the occurrences of the price staying below 50 for consecutively 4 days account for roughly 13 %.
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