Exam 11: The Efficient Market Hypothesis

Which of the following are used by technical analysts to determine proper stock prices I. Trendlines II. Earnings III. Dividend prospects IV. Expectations of future interest rates V. Resistance levels

Studies of negative earnings surprises have shown that there is

Proponents of the EMH typically advocate

A common strategy for passive management is

Jaffe (1974) found that stock prices _________ after insiders intensively bought shares.

__________ focus more on past price movements of a firm's stock than on the underlying determinants of future profitability.

At freshman orientation, 1,500 students are asked to flip a coin 20 times.One student is crowned the winner (tossed 20 heads).This is most closely associated with

Discuss the small firm effect, the neglected firm effect, and the January effect, the tax effect and how the four effects may be related.

Proponents of the EMH think technical analysts

Arbel (1985) found that

A finding that _________ would provide evidence against the semistrong form of the efficient market theory.

When Maurice Kendall first examined stock price patterns in 1953, he found that

The weak form of the efficient market hypothesis contradicts

Fama and French (1992) found that the stocks of firms within the highest decile of book-to-market ratios had average monthly returns of _______, while the stocks of firms within the lowest decile of book-to-market ratios had average monthly returns of ________.

Studies of stock price reactions to news are called

___________ the return on a stock beyond what would be predicted from market movements alone.

Studies of positive earnings surprises have shown that there is

The weather report says that a devastating and unexpected freeze is expected to hit Florida tonight, during the peak of the citrus harvest.In an efficient market one would expect the price of Florida Orange's stock to

The stock market follows a

A support level is the price range at which a technical analyst would expect the