The semi-strong form of the efficient market hypothesis maintains that:
A)all public and private information is already impounded into the value of a security.
B)there is no relationship between past and future prices.
C)all public information is already impounded into the value of a security.
D)insider information is immediately impounded into the value of a security.

Question

Quizplus · Accepted Answer

The semi-strong form of the efficient market hypothesis maintains that all public information is already impounded into the value of a security; and therefore, one cannot use fundamental analysis to determine whether a stock is undervalued or overvalued. If the semi-strong form is true, then fundamental analysis doesn't work.

The Semi-Strong Form of the Efficient Market Hypothesis Maintains That