With more and more responsible investors, the security market will be more efficient (or not)? Please give 2 reasons
| The Answer to question is: | |
| Yes, with more and more responsible investors, the security market will become more efficient, reasons are as follows: | |
| 1 | When Investors become more and more responsible, they tend to ask more questions through various means viz., raising questions in general meeting, raising questions through audit committee, this makes companies more responsible and accountable for their activities and it improves overall quality of not only financial reporting but also of overall operations carried out by the company. |
| 2 | When Investors become more and more responsible, they tend to react to every favourable decision by way of more and more demands for securities of the company, on the contrary when any adverse situation arises in the company, investors tend to sell securities of that company, this increases selling presure. |
| 3 | Active Investors always looks for both short term cash management and long term stability of income, so that they get reliable income source. Therefore, they tend to check historical performance of the company along with current performance. |
With more and more responsible investors, the security market will be more efficient (or not)? Please...
In an efficient capital market, all security investments will have a(n) ____. a. NPV of zero b. positive NPV c. required rate of return that exceeds the cost of capital d. required rate of return that is zero --------------------------------------------------------------------------- Capital markets are said to be efficient. This means _____. a. accurate stock quotes are quickly available to all investors b. security prices quickly reflect all economically relevant information c. they process stock trades accurately and quickly d. the market provides...
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 .
The Efficient Market Hypothesis says that on average, investors are not likely to consistently earn returns above those expected for the risk. True or False?
Explain what “efficient” means with regard to the stock market. Is the stock market of the U.S. efficient in pricing stock? The stock markets in the U.S. are more efficient than in many other countries. Does that mean that all information is available to all investors?
“In an efficient market, money managers and financial advisers have little value to investors.” Do you agree or disagree with this statement? Explain. (A proper answer to this question should include the meaning of an efficient market and its implications.)
Can you please assist me explaining what it means to have an efficient capital market? More specifically, can you please provide context and explanations as to the behavioral challenges in achieving efficiency, the three forms or kinds of market efficiency, the implications they have to corporate finance, and whether you would or not you would consider the real estate market an efficient capital market?
The efficient market hypothesis states that current security prices will fully reflect all available information, because in an efficient market, all unexploited profit opportunities are eliminated. The elimination of unexploited profit opportunities necessary for a financial market to be efficient does not require that all market participants be well informed. The efficient markets hypothesis implies that stock prices generally follow a random walk.
Explain and describe what an efficient market is in 500 words or more. Efficent Market: 1. Equilibrium 2. Intrinsic Value
5. The Capital Market Line and the Security Market Line In the following table, check whether each statement refers to the Capital Market Line (CML) or to the Security Market Line (SML). Statement Capital Market Line (CML) Security Market Line (SML) This line defines the linear relationship between the expected return on an efficient portfolio and its standard deviation. The slope of this line, (r̂Mr̂M – rRFrRF)/σMσM, reflects the investors’ aggregated, or market-level, expected premium for risk. This line describes...
Why was the turmoil in the auction rate security (ARS) market noteworthy? Because they were responsible for the collapse of Bear Stearns Because they represent a direct link between the financial crisis and the real economy, with failed ARS auctions resulting in significantly higher borrowing costs for municipalities Because they were responsible for the Lehman bankruptcy Because they were the first securities to fail in the financial crisis