I only paraphrased standard definitions for the terms I used—you asked what I meant.
information includes data on previous prices, trading volume It was Fama who idea posited that it is virtually impossible to consistently beat the market– to make investment returns that outperform the overall market average as reflected by major stock indexes such as the S&P 500 Index. This depends on assuming that stocks always trade at their fair market value. Past price performance can’t predict future prices. There are three variations of the EMH hypothesis – the weak, semi-strong, and strong form– which represent three different assumed levels of market efficiency. Weak: the prices of securities reflect all available public market information Semi-strong: Additionally prices rapidly adjust to new information Strong: not even insider knowledge can give investors a predictive edge Exploitable opportunities should not exist in an efficient market. in efficient markets, investors can- not earn a risk-weighted excess return. In efficient markets, available information is already incorporated in stock prices. I tried to offer some concrete examples that it EMH does not hold. The equivalency of P and NP is one of the seven problems that the Clay Mathematics Institute will give you a million dollars for proving — or disproving. Maybe it would be more profitable to focus on that. Donna Y [email protected] > On Aug 13, 2019, at 2:24 PM, Raul Miller <[email protected]> wrote: > > On Mon, Aug 12, 2019 at 7:39 PM Donna Y <[email protected]> wrote: >> Outperform the market or beat the market--the security will produces higher >> returns, for a given timeframe than the major market indexes. > > Higher than what? Higher than the average? That happens all the time. > Higher than the maximum? That's silly, especially if your performance > is the current maximum. > >> The Efficient Market Hypothesis, or EMH, is an investment theory >> that share prices reflect all information thus theoretically, >> neither technical nor fundamental analysis can produce risk-adjusted >> excess returns thus impossible to outperform the overall market >> through expert stock selection or market timing. > > What's "all information"? > > If it's "all available information" then the claim is meaningless, > since any information that's being ignored can be said to be "not > available". > > If it's really "all information" then it's "meaningful but silly", > because neither people, nor markets are omniscient. It is something a > sleazy salesman might claim though, when he really doesn't have any > clue what he's talking about. > > Thanks, > > -- > Raul > ---------------------------------------------------------------------- > For information about J forums see http://www.jsoftware.com/forums.htm ---------------------------------------------------------------------- For information about J forums see http://www.jsoftware.com/forums.htm
