Which of the following best describes 'strong- form efficiency'?
A) All relevant information, including that which is privately held, is reflected in the share price.
B) Share prices fully reflect information available only to certain shareholders.
C) Share prices fully reflect all the relevant, publicly available information.
D) Share prices fully reflect all information contained in past price movements.

Question

Quizplus · Accepted Answer

Strong-form efficiency states that all relevant information, including that which is privately held, is reflected in the share price. This means that no investor, regardless of their level of access to information, can consistently generate abnormal returns by using private information.

Which of the Following Best Describes 'Strong- Form Efficiency