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 refutes 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 supports the semistrong form of the efficient market hypothesis.
C)outperform a market index.Assuming mutual fund managers rely primarily on public information, this finding refutes the semistrong form of the efficient market hypothesis.
D)outperform a market index.Assuming mutual fund managers rely primarily on public information, this finding supports the semistrong form of the efficient market hypothesis.
E)Both C and D.

Question

Quizplus · Accepted Answer

Studies have consistently found that professionally managed mutual funds do not outperform a market index. Assuming that mutual fund managers rely primarily on publicly available information to make their investment decisions, this finding supports the semistrong form of the efficient market hypothesis, which states that all publicly available information is already reflected in stock prices. Therefore, it is difficult for mutual fund managers to consistently beat the market through their analysis and selection of individual stocks.

Studies of the Performance of Professionally Managed Mutual Funds Find