There is little evidence from studies examining initial public offerings (IPOs) that suggest markets are semistrong-form efficient.

Question

Quizplus · Accepted Answer

Studies on initial public offerings (IPOs) often show significant underpricing on the first day of trading, which is inconsistent with semistrong-form efficiency. This suggests that markets do not always fully incorporate publicly available information into stock prices, as semistrong-form efficiency would imply.

There Is Little Evidence from Studies Examining Initial Public Offerings