If you believe the market is not semi-strong form efficient or strong form efficient, you should engage in which of the following?
A.Trade stocks base on insider information
B. Conduct fundamental analysis to find undervalued stocks
C. Read stock price charts
D. Trade on insider information and conduct fundamental analysis
E. Buy market index mutual funds.
Option B is correct
If makret is not semi strong form and strong form, then fundamental analysis can be used to determine over and undervalued stock
If you believe the market is not semi-strong form efficient or strong form efficient, you should...
If the stock market is semi-strong-form efficient, investors can “beat the market” if they A. trade quickly enough based on recent public information. B. get inside information. C. train monkeys to pick stocks for them. D. perform technical analysis .
Question 23 According to the semi-strong form of efficient market hypothesis: Using insider information one can earn abnormally high returns from stocks. Financial statement analysis can be used to earn abnormally high returns from stocks. Using past price and volume information one can earn abnormally high returns from stocks. None of these is correct Private information is of no help in earning abnormally high returns.
If markets were semi-strong form efficient, which of the following situations would yield abnormal returns? Analyzing a company’s earnings report. Identifying a pattern in a company’s stock price. Obtaining insider information. None of the above would yield abnormal returns.
investment analysis In the context of the efficient market hypothesis: a) Describe the weak form, the semi-strong form and the strong form of capital market efficiency. (9 Marks) b) Which form, if any, do you favor and why? (3 Marks) c) In your opinion, in what form is our Zambian capital market and why. (4 Marks) d) What should be done, if any, to bring it to the form you favour? (4 Marks) [TOTAL: 20 MARKS]
Which of the following statement(s) is/are false? I. In an efficient market (strong form efficiency), fundamental analysis still provides value to an investor II. Based on the semi-strong form of the efficient market theory, an investor reacting immediately to a news flash on the television generaly cannot make a reasonable profit. III. Retail investors prefer weak form efficiency over strong form efficiency I only O ll only Ill only O 1 & Ill only O None of the above answers
19) According to the efficient market hypothesis, a) Fundamental analysis that generates POSITIVE alpha violates STRONG form efficiency. b) Fundamental analysis that generates POSITIVE alpha violates WEAK form efficiency. c) Fundamental analysis that generates POSITIVE alpha violates SEMI-STRONG form efficiency. d) Both a) and c) are correct. e) Both b) and c) are correct.
QUESTION THREE In the context of the efficient market hypothesis; Describe the weak form, the semi-strong form and the strong form of capital market efficiency. (9 Marks) Which form, if any, do you favor and why? (3 Marks) In your opinion, in what form is our Zambian capital market and why. (4 Marks) What should be done, if any, to bring it to the form you favour? (4 Marks) [TOTAL: 20 MARKS]
A) In a semi strong form market, how would stock prices react to a company announcing yearly profits? B) Martha can make abnormal returns trading on information - what does this say about the efficiency of the market? Give 2 reasons why she shouldn't do this. C) Your friend wants to invest all of his wealth into stocks due to a pick from a technical analysis. Discuss why he is an idiot for doing that ensuring you talk about market...
Which of the following statements regarding the efficient market hypothesis is NOT accurate? Select one: a. The strong form state prices reflect all information, including public and private b. Semi strong form Implies that fundamental analysis will not lead to abnormal returns c. If the market is weak form efficient, then investors can earn abnormal returns by trading on market information d. Strong form Implies that technical analysis will not lead to abnormal returns e. All of the answers are...
Let’s say you believe the market is not that efficient. Then how do you explain why the vast majority of hedge fund and mutual funds do not beat the market when fees are accounted for? Efficient market theory