Which of the following is a statement of weak-form efficiency?
I.If markets are efficient in the weak form, then it is impossible to make consistently superior profits by using trading rules based on past returns.
II.If markets are efficient in the weak form, then prices will adjust immediately to public information.
III.If markets are efficient in the weak form, then prices reflect all information.
A)I only
B)II only
C)II and III only
D)III only

Question

Quizplus · Accepted Answer

A statement of weak-form efficiency states that past prices and trading volumes do not provide any useful information on future prices. Only statement I describes this principle, stating that consistently superior profits cannot be made by using trading rules based on past returns. Statements II and III refer to strong-form and semi-strong form efficiency, respectively.

Which of the Following Is a Statement of Weak-Form Efficiency