Efficient Market Hypothesis will be available on
Efficient Market Hypothesis & The Stork Theory
Efficient market hypothesis has been the subject of debate among the investing academia since its debut in the 1960s. All data points to the fact that investing for the long term is a more profitable strategy then trying to cash in quickly.
Don't Fall For The Efficient Market Hypothesis
"I believe there is no other proposition in economics which has more solid empirical evidence supporting it than the Efficient Market Hypothesis."
"If the efficient markets hypothesis was a publicly traded security, its price would be enormously volatile."
Shleifer and Summers (1990)
"It is disarmingly simple to state, has far-reaching consequences for academic pursuits and business practice, and yet is surprisingly resilient to empirical proof or refutation."
Lo in Lo (1997)
"Market efficiency survives the challenge from the literature on long-term return anomalies. Consistent with the market efficiency hypothesis that the anomalies are chance results, apparent overreaction to information is about as common as underreaction, and post-event continuation of pre-event abnormal returns is about as frequent as post-event reversal. Most important, consistent with the market efficiency prediction that apparent anomalies can be due to methodology, most long-term return anomalies tend to disappear with reasonable changes in technique."
"What, then, can we conclude about market efficiency? Amazingly, there is still no consensus among financial economists. Despite the many advances in the statistical analysis, databases and theoretical models surrounding the efficient markets hypothesis, the main effect has been to harden the resolve of the proponents on each side of the debate."
Lo (2000) in Cootner (1964)
Found out what the efficient market hypothesis says ..
In semi-strong-form efficiency, it is implied that share prices adjust to publicly available new information very rapidly and in an unbiased fashion, such that no excess returns can be earned by trading on that information. Semi-strong-form efficiency implies that neither nor techniques will be able to reliably produce excess returns. To test for semi-strong-form efficiency, the adjustments to previously unknown news must be of a reasonable size and must be instantaneous. To test for this, consistent upward or downward adjustments after the initial change must be looked for. If there are any such adjustments it would suggest that investors had interpreted the information in a biased fashion and hence in an inefficient manner.