As an example: Over this past weekend, from Friday close to Monday open, Netflix (NFLX) dropped about 36% in stock price. Going back to July, Netflix was trading near $300, and now it is at about $79. This seems due to some announcements about loss of customers as well as what seems to be perceived by some as strategic blunders.
This strikes me as an incredible drop for such a big, "hot", well-known company that has a volume of ~12 million shares and a market capitalization of ~$4 billion. Those who bought when it was selling for $100 to $300 cannot be pleased with this turn of events.
The question is: How often does this sort of thing occur? Can such a likelihood even be quantified? Are there things to watch out for in assessing the likelihood of a future dive?
I ask because it seems that with swing trading small low-stock-price companies, there is a lot of volatility and big movements are part of what you expect. But one might be tempted to feel a lot more "stable" (safer?) holding shares in huge and profitable companies? But of course, they take sudden dives, too.