Question

As we all know, because of market psychology when stocks increase in price on one day, they tend to decrease in price the next day. A payoff matrix shows the pertinent percents. (Because of the limitations of Educator, I have to write out the payoff matrix in linear fashion). Now here's the payoff matrix. If today the stock price increases, then the likelihood it will increase tomorrow is 0.2 and the likelihood it will decrease tomorrow is 0.8. If today the stock price decreases, then the likelihood it will increase tomorrow is 0.6 and the likelihood it will decrease tomorrow is 0.4. So the qu