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The chapters this week explore the efficient market hypothesis and its three forms. Which form do...

The chapters this week explore the efficient market hypothesis and its three forms. Which form do you think currently exists and why?

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Answer #1

Three forms of efficient market hypothesis are Weak, Semi strong and Strong

Weak Form of EMH: Market is efficient and reflects all the market information(past public information). Futures rates of return are independent of past rates of return

Semi Strong form of EMH: Market is efficient and reflects all the publicly available information.Stock prices always absord and reflect the up to date available information publicly

Strong form of EMH: Market is efficient and reflects all the public and private information available

Semi strong form of EMH currently exists, because stocks usually reacts and reflects the as soon as some new public information released rather than past public information or private information.

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