Under the efficient markets hypothesis
A) Stock prices follow a random walk
B) All relevant information bearing on a stock's value is embedded in its price
C) Careful picking of stocks cannot be expected to provided better-than-market returns
D) All of the above

Question

Quizplus · Accepted Answer

The efficient markets hypothesis posits that stock prices fully reflect all available information, which leads to the conclusions that prices follow a random walk, all relevant information is embedded in stock prices, and that careful stock picking cannot consistently yield better-than-market returns.

Under the Efficient Markets Hypothesis