If the market is semistrong-form efficient,then which one of the following statements is true?
A) Neither technical nor fundamental analysis leads to abnormal profits.
B) Technical analysts have the ability to earn excess profits but fundamental analysts cannot.
C) Fundamental analysts can earn excess profits but technical analysts cannot.
D) Both technical and fundamental analysts earn excess profits based on their research.
E) No answer can be determined as the form of market efficiency is unrelated to abnormal, or excess returns.

Question

Quizplus · Accepted Answer

Semi-strong form efficiency implies that all publicly available information is already reflected in the current stock prices. Therefore, neither technical nor fundamental analysis can provide abnormal profits as all relevant information is already incorporated into the price.

If the Market Is Semistrong-Form Efficient,then Which One of the Following