One piece of evidence suggesting that the stock market is efficient is that most individual investors cannot earn returns that beat the overall market average return,but professional investors such as mutual fund and pension fund managers generally do earn higher-than-average returns.

Question

Quizplus · Accepted Answer

This statement is inaccurate. The fact that professional investors such as mutual fund and pension fund managers generally earn higher-than-average returns does not necessarily suggest that the stock market is efficient. It could be due to factors such as their access to better information, resources, or expertise that individual investors lack. Additionally, there is evidence that some mutual fund managers may not consistently outperform the market after accounting for fees and expenses.

One Piece of Evidence Suggesting That the Stock Market Is