ACCA FM · Chapter 13 · Question 4 of 9
If a stock market is semi-strong form efficient, which of the following is correct?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Share prices reflect all publicly available information, so analysing published financial statements will not consistently produce abnormal returns
Explanation
In a semi-strong form efficient market, share prices adjust quickly and accurately to all publicly available information, including past prices and new announcements. Neither technical nor fundamental analysis of public information can consistently beat the market, but investors with inside information could still earn abnormal returns.
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