Respuesta :
The weak form of the EMH states that (A) all past information, including security price and volume data must be reflected in the current stock price.
What is EMH?
- The efficient market hypothesis (EMH), often known as the efficient market theory, is a hypothesis that claims that share prices represent all information and hence persistent alpha production is impossible.
- According to the EMH, stocks always trade at their fair value on exchanges, making it impossible for investors to buy undervalued stocks or sell them at inflated prices.
- The weak form of the EMH asserts that all historical information, including security price and volume data, must be represented in the current stock price.
- As a result, it should be difficult to outperform the entire market through skilled stock selection or market timing, and the only way for an investor to earn higher returns is to invest in riskier assets.
Therefore, the weak form of the EMH states that (A) all past information, including security price and volume data must be reflected in the current stock price.
Know more about EMH here:
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The complete question is given below:
The weak form of the EMH states that ________ must be reflected in the current stock price.
A. all past information, including security price and volume data
B. all publicly available information
C. all information, including inside information
D. all costless information
