Question 1: When is it a better time to buy Willis Towers Watson Public Limited Company stock - after a drop or after a rise?Answer:Consider two situations,Case 1: Willis Towers Watson Public Limited Company stock drops by -5% or more in a monthCase 2: Willis Towers Watson Public Limited Company stock rises by 5% or more in a month
WLTW stock fares better after Case 1, with a 68.1% chance of rise over the next month (21 trading days) under Case 1 (where the stock has suffered a 5% loss over the previous month), versus, a 54.5% chance of rise for Case 2. This would suggest that it is better to buy WLTW stock after a recent drop
Try the Trefis machine learning engine to see for yourself how Willis Towers Watson Public Limited Company stock is likely to behave after any specific gain or loss over a period.
Question 2: Does Willis Towers Watson Public Limited Company stock have a higher chance of rise after a steeper drop?Answer:Trefis machine learning engine's calculations show that for most stocks, the chance of rise reduces as the drop gets steeper. However, after unusually high declines of -10% or more, there is usually an improvement in the chance of rise. This makes sense intuitively, as markets often overreact to bad news around a company
For WLTW stock, the probability of positive returns over the next month (21 trading days) after a drop of N% over the last 21 trading days is detailed in the table below, along with the positive return probability for the S&P500:
Previous 21 days% DropNext 21 daysPositive Return ProbabilityWLTW S&P 500-1%64.8%71.1%-3%70.8%73.0%-5%68.1%72.7%-7.5%65.2%78.3%-10%62.7%78.4%
Question 3: What about Willis Towers Watson Public Limited Company stock's chance of rise after a recent rally?
Answer:WLTW's probability of positive returns over the next month (21 trading days) after a gain of N% over the last 21 trading days is detailed in the table below, along with the positive return probability for the S&P500:
Previous 21 days% RiseNext 21 daysPositive Return ProbabilityWLTW S&P 500+1%55.2%67.8%+3%52.6%68.5%+5%54.5%67.0%+7.5%49.6%68.4%+10%39.1%74.2%