NASDAQ stock (NASDAQ: NDAQ) returned 2.6% in the last five trading days and currently trades close to $196 per share. The NASDAQ Inc., a global exchange group that provides trading, exchange technology, securities listing, and public company services globally, has seen its stock gain almost 48% YTD. The company recently released its August Month’s volumes details, with U.S. equity options gaining some ground, partially offset by a decline in European options and futures volume. Further, the U.S. cash equity volume was down almost 7% on a year-on-year basis, while the European equity volume gained almost 20%.
The exchange outperformed the revenues and earnings consensus estimates in the second quarter of 2021. It reported net revenues of $846 million, which is 21% more than the year-ago period. This could mainly be attributed to lower transaction-based expenses as compared to the year-ago period. Further, investment intelligence and market technology segments reported some growth in the quarter.
But will NDAQ stock continue its upward trajectory over the coming weeks, or is a drop in the stock more likely? According to the Trefis Machine Learning Engine, which identifies trends in a company’s stock price data for the last ten years, returns for NDAQ stock average close to 1.8% in the next one-month (21 trading days) period after experiencing a 2.6% rise over the last one week (five trading days) period. Also, there is a 67% chance that the stock will give positive returns over the next one-month period.
But how would these numbers change if you are interested in holding NDAQ stock for a shorter or a longer time period? You can test the answer and many other combinations on the Trefis Machine Learning to test NASDAQ stock chances of a rise after a fall and vice versa. You can test the chance of recovery over different time intervals of a quarter, month, or even just one day!
MACHINE LEARNING ENGINE – try it yourself:
IF NDAQ stock moved by -5% over five trading days, THEN over the next 21 trading days, NDAQ stock moves an average of 6.3 percent with a 82.7% probability of positive returns.
Some Fun Scenarios, FAQs & Making Sense of Nasdaq Stock Movements:
Question 1: Is the average return for Nasdaq Stock higher after a drop?
Consider two situations,
Case 1: Nasdaq stock drops by -5% or more in a week
Case 2: Nasdaq stock rises by 5% or more in a week
Is the average return for Nasdaq stock higher over the subsequent month after Case 1 or Case 2?
NDAQ stock fares better after Case 1, with an average return of 6.3% over the next month (21 trading days) under Case 1 (where the stock has just suffered a 5% loss over the previous week), versus, an average return of 2.2% for Case 2.
In comparison, the S&P 500 has an average return of 3.1% over the next 21 trading days under Case 1, and an average return of just 0.5% for Case 2 as detailed in our dashboard that details the average return for the S&P 500 after a fall or rise.
Try the Trefis machine learning engine above to see for yourself how Nasdaq stock is likely to behave after any specific gain or loss over a period.
Question 2: Does patience pay?
If you buy and hold Nasdaq stock, the expectation is over time the near-term fluctuations will cancel out, and the long-term positive trend will favor you – at least if the company is otherwise strong.
Overall, according to data and Trefis machine learning engine’s calculations, patience absolutely pays for most stocks!
For NDAQ stock, the returns over the next N days after a -5% change over the last five trading days is detailed in the table below, along with the returns for the S&P500:
Question 3: What about the average return after a rise if you wait for a while?
The average return after a rise is understandably lower than after a fall as detailed in the previous question. Interestingly, though, if a stock has gained over the last few days, you would do better to avoid short-term bets for most stocks.
NDAQ’s returns over the next N days after a 5% change over the last five trading days is detailed in the table below, along with the returns for the S&P500:
It’s pretty powerful to test the trend for yourself for NASDAQ stock by changing the inputs in the charts above.
What if you’re looking for a more balanced portfolio instead? Here’s a high-quality portfolio that’s beaten the market since 2016