Exam 11: The Efficient Market Hypothesis

Google has a beta of 1.0.The annualized market return yesterday was 11%, and the risk-free rate is currently 5%.You observe that Google had an annualized return yesterday of 14%.Assuming that markets are efficient, this suggests that

Which of the following are investment superstars who have consistently shown superior performance I. Warren Buffet II. Phoebe Buffet III. Peter Lynch IV. Merrill Lynch V. Jimmy Buffet

The difference between a random walk and a submartingale is the expected price change in a random walk is ______, and the expected price change for a submartingale is ______.

Proponents of the EMH typically advocate

Studies of mutual fund performance

A market decline of 23% on a day when there is no significant macroeconomic event ______ consistent with the EMH because ________.

The weak form of the efficient market hypothesis asserts that

If you believe in the _________ form of the EMH, you believe that stock prices reflect all available information, including information that is available only to insiders.

What is an event study It is a test of what form of market efficiency Discuss the process of conducting an event study, including the best variable(s) to observe as tests of market efficiency.

QQAG just announced yesterday that its fourth quarter earnings will be 35% higher than last year's fourth quarter.You observe that QQAG had an abnormal return of -1.7% yesterday.This suggests that

A hybrid strategy is one where the investor