The efficient markets hypothesis implies that stock investments should have the same expected return after adjusting for

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The efficient markets hypothesis (EMH) posits that all available information is already reflected in stock prices, implying that stocks always trade at their fair value. Therefore, after adjusting for differences in risk, information costs, and liquidity, all stocks should offer the same expected return. This is because the EMH suggests that no investor can consistently achieve higher returns without assuming additional risk, incurring higher information costs, or facing liquidity constraints.

The Efficient Markets Hypothesis Implies That Stock Investments Should Have