According to the efficient markets hypothesis, the number of people who think a stock is overvalued exactly balances the number of people who think a stock is undervalued.

Question

Quizplus · Accepted Answer

The efficient markets hypothesis states that all available information is reflected in the price of a stock, so there is no way to consistently beat the market. This means that there is no way to know whether a stock is overvalued or undervalued, so the number of people who think a stock is overvalued exactly balances the number of people who think a stock is undervalued.

According to the Efficient Markets Hypothesis, the Number of People