Which one of the following is probably your best investment strategy as long as the market is at least semi-strong form efficient?
A) invest based on the advice of a technical analyst
B) invest based on the advice of a fundamental analyst
C) invest only in your employer's firm
D) invest in an index fund
E) invest in a value fund which is actively managed by a professional money manager

Question

Quizplus · Accepted Answer

If the market is at least semi-strong form efficient, it means that all publicly available information is already reflected in the stock prices. Therefore, it is difficult to outperform the market by using technical or fundamental analysis, or by picking individual stocks. Investing in an index fund, which tracks the performance of a market index, is a low-cost and diversified way to capture the overall market return. This strategy has been shown to be effective in the long term, and is recommended by many financial experts.

Which One of the Following Is Probably Your Best Investment