If the stock market is efficient with respect to the incorporation of publicly available information,then:

Question

Quizplus · Accepted Answer

If the stock market is efficient with respect to the incorporation of publicly available information, it means that all available information is already reflected in the stock price. As such, it is unlikely that fundamental analysis, which looks at a company's financial statements and economic factors, will yield abnormal profits. Technical analysis, which relies on past stock price patterns to predict future performance, is also unlikely to be profitable. Charting a company's share prices may still be useful for tracking trends, but it is not likely to generate abnormal profits. Lastly, insider information is illegal to use for trading and unlikely to lead to abnormal profits if detected.

If the Stock Market Is Efficient with Respect to the Incorporation