Which of the following most appears to contradict the proposition that the stock market is weakly...
Which of the following most appears to contradict the proposition that the stock market is weakly efficient?
| A. |
Stocks with low book-to-market have lower returns. |
|
| B. |
Investments in stock of less well-known firms are likely to generate abnormal returns. |
|
| C. |
Hedge funds that outperform the market in one year are likely to outperform in the following year. |
|
| D. |
Insiders earn abnormal trading profits. |
Homework Answers
Ans) the correct option is d) Insiders earn abnormal trading profits.
Every January, the stock market earns abnormal returns
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