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The weak form of the efficient-market hypothesis asserts that
A) stock prices do not rapidly adjust to new information contained in past prices or past data.
B) future changes in stock prices cannot be predicted from past prices.
C) technicians cannot expect to outperform the market.
D) stock prices do not rapidly adjust to new information contained in past prices or past data, and future changes in stock prices cannot be predicted from past prices.
E) future changes in stock prices cannot be predicted from past prices, and technicians cannot expect to outperform the market.
Efficient-Market Hypothesis
The theory that all existing information is already reflected in stock prices, thus making it impossible to consistently achieve higher returns than the overall market through stock selection or market timing.
Stock Prices
The cost or value of a share of a company's stock traded on the stock market.
Technicians
Analysts who use historical market data, charts, and statistical techniques to predict future market movements, focusing on patterns and prices.
- Absorb the principles of the Efficient Market Hypothesis (EMH) and explore its significance for investment strategy planning.
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Learning Objectives
- Absorb the principles of the Efficient Market Hypothesis (EMH) and explore its significance for investment strategy planning.
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