Wednesday, November 26

Strong-Form EMH

· Security prices reflect all information both public and private
· No investor would be able to profit above the average investor even if he was given new information.

Test results:
Supported by evidence that after accounting for transaction costs security analysts and portfolio managers cannot generate excess returns. Corporate insiders and stock market specialists are exceptions who can generate excess returns. But Securities analysts are not able to outperform buy and hold strategy

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