Question

Which of the following theories states that security prices reflect all public information, but not all private information?

A.) Nominal-form efficiency.

B.) Strong-form efficiency.

C.) Semistrong-form efficiency.

D.) Weak-form efficiency.

Answer 1

Option (C) is correct

Semi strong form of efficiiency states that security prices reflect all public information, but not all private information.

Option (A) is incorrect as there is no Nominal form efficiency in the markets.

Option (B) is incorrect as in strong form of efficiency, all the information, whether public or private, is reflected in the stock price.

Option (D) is incorrect as in weak form of efficiency, current stock prices reflect the past data.