In a semi- strong form efficient market,which of the following may still allow a trader to generate abnormal returns?

Question

Quizplus · Accepted Answer

In a semi-strong form efficient market, all publicly available information is already reflected in stock prices, meaning that analyzing past prices or public news (like earnings announcements) won't provide an edge. However, insider information, such as knowing about an upcoming merger from a friend within the company, is not publicly available and could allow a trader to generate abnormal returns. This practice, however, is illegal in many jurisdictions.

In a Semi- Strong Form Efficient Market,which of the Following