Weak form efficiency implies that past stock price(s)
A) patterns tend to repeat itself in the future
B) are major inputs to the investors for forming trading strategies
C) do not matter
D) none of the above

Question

Quizplus · Accepted Answer

Weak form efficiency suggests that past stock prices do not contain any useful information for predicting future prices. Therefore, past prices do not matter and cannot be used to form profitable trading strategies. Choice A and B imply that past prices are useful, which contradicts the assumption of weak form efficiency.

Weak Form Efficiency Implies That Past Stock Price(s)