When market is efficient in the semi-strong form:
A) investors would be able to earn abnormal returns by using publicly available information.
B) a security's price at a particular time fully reflects the information contained in its sequence of past prices.
C) investors would be able to earn abnormal returns by trading on private information.
D) a security's price at a particular time fully reflects both publicly and privately available information.

Question

Quizplus · Accepted Answer

In a semi-strong form efficient market, all publicly available information is already reflected in stock prices, so abnormal returns cannot be earned using such information. However, abnormal returns can still be earned using private information.

When Market Is Efficient in the Semi-Strong Form