It may be argued that share prices on the Australian Securities Exchange (ASX)reflect all publicly available,relevant information regarding listed companies,and therefore superior profits cannot be made by an investor using publicly available information.Based on the above contention,which of the following statements best describes the informational efficiency of the ASX?
A) Strong-form efficiency.
B) Semi-strong form efficiency.
C) Weak-form efficiency.
D) Random walk efficiency.

Question

Quizplus · Accepted Answer

The statement about share prices reflecting all publicly available information refers to semi-strong form efficiency. This means that all publicly available information is reflected in share prices, but not insider information. It does not refer to strong-form efficiency (which includes insider information) or weak-form efficiency (which only considers past price movement). Random walk efficiency is a related concept, but not the best answer in this case.

It May Be Argued That Share Prices on the Australian