If the market is weak form efficient:
A)semistrong form efficiency holds.
B)strong form efficiency must hold.
C)semistrong form efficiency may hold.
D)markets are not weak form efficient.
E)None of the above.

Question

Quizplus · Accepted Answer

If the market is weak form efficient, it means that historical prices and publicly available information are factored into the current market prices. This does not necessarily mean that all information, including non-public information, is factored into the price (strong form efficiency) or that all information including historical prices and publicly available information as well as insider information are factored into the price (semistrong form efficiency). Therefore, semistrong form efficiency may or may not hold.

If the Market Is Weak Form Efficient