The efficient markets hypothesis states that current prices reflect all publicly available information.

Question

Quizplus · Accepted Answer

The efficient markets hypothesis suggests that financial markets are "informationally efficient" which means that security prices fully reflect all available information at any given point of time. This implies that it is not possible to systematically outperform the market through analysis of publicly available information as market reflects all information accurately and immediately.

The Efficient Markets Hypothesis States That Current Prices Reflect All