Question) According to the semi-strong form of the efficient markets hypothesis, ____. Multiple Choice Answers) Please...

Question) According to the semi-strong form of the efficient markets hypothesis, ____.

Multiple Choice Answers) Please answer and explain!

a) stock prices do not rapidly adjust to new information.

b) corporate insiders should have no better investment performance than other investors even if allowed to trade freely.

c) future changes in stock prices cannot be predicted from any information that is publicly available.

d) arbitrage between futures and cash markets should not produce extraordinary profits.

Solutions

Expert Solution

option c is correct

The semi-strong market efficiency hypothesis contends that a security's price movements are a reflection of publicly available material information. It suggests that fundamental and technical analysis are not helpful in predicting a stock's future price movement.

jeff jeffy answered 2 years ago

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