The weak form of the efficient market theory contends that
A)past price performance is useless in predicting future price movements.
B)past performance can help determine the general direction of future price movements.
C)any publicly available information is useless in predicting future price movements.
D)price movements are not random but follow a general trend over a period of time.

Question

Quizplus · Accepted Answer

The weak form of the efficient market theory states that past price performance is already reflected in current security prices, making it useless in predicting future price movements. This suggests that no investor can consistently gain an advantage by using technical analysis or studying historical trends.

The Weak Form of the Efficient Market Theory Contends That