The strong form of the efficient market hypothesis suggests that only insiders are able to show superior risk-adjusted returns.

Question

Quizplus · Accepted Answer

The strong form of the efficient market hypothesis goes beyond the semi-strong form to state that stock prices reflect not only all public information, but all information. Thus, it is hypothesized that insider information is also immediately impounded into the value of a security. In a sense, we go beyond the concept of a market that is highly efficient, to one that is perfect.

The Strong Form of the Efficient Market Hypothesis Suggests That