Which is NOT an implication of the EMH?
A) To do superior industry or company analysis, you must understand the variables that affect returns and do a superior job of estimating these variables.
B) Aggregate market analysis that involves very detailed analysis of reliable historical economic data should outperform a simple buy-and-hold policy.
C) A superior analyst is one who can consistently select stocks that provide positive abnormal returns on a risk-adjusted basis.
D) If a portfolio manager does not have any superior analysts, he/she should consider investing funds in an index fund.
E) If a portfolio manager has some superior analytical skills, they should be encouraged to concentrate in second tier stocks which have liquidity but may be neglected.

Question

Quizplus · Accepted Answer

The EMH does not necessarily imply that detailed market analysis will outperform a simple buy-and-hold strategy, as the market is assumed to be efficient and therefore already reflects all available information.

Which Is NOT an Implication of the EMH