Studies of the performance of professionally managed mutual funds find that these funds:
A)do not outperform a market index.Assuming mutual fund managers rely primarily on public information,this finding supports the semistrong form of the efficient market hypothesis.
B)do not outperform a market index.Assuming mutual fund managers rely primarily on public information,this finding refutes the semistrong form of the efficient market hypothesis.
C)outperform a market index.Assuming mutual fund managers rely primarily on public information,this finding supports the semistrong form of the efficient market hypothesis.
D)outperform a market index.Assuming mutual fund managers rely primarily on public information,this finding refutes the semistrong form of the efficient market hypothesis.
E)Both C and D.

Question

Quizplus · Accepted Answer

The finding that professionally managed mutual funds do not outperform a market index suggests that the market is efficient in the semistrong form. This is because mutual fund managers, who have access to public information, are not able to consistently use this information to outperform the market. Therefore, the market is efficient in processing and reflecting publicly available information in the current market prices.

Studies of the Performance of Professionally Managed Mutual Funds Find