market in which asset prices reflect new information quickly and rationally

market is thus a market in which asset prices reflect all past and present information

a passive investment strategy (i.e., buying and holding a broad market portfolio) that does not seek superior riskadjusted returns is preferred to an active investment strategy because of lower costs (fo example, transaction and information-seeking costs). By contrast, in a very inefficient market,

An efficient market is a market in which asset prices reflect information quickl (speed of adjustment.).

Market value is the price at which an asset can currently be bought or sold.

Intrinsic value (sometimes called fundamental value) is, broadly speaking, the value that would be placed on it by investors if they had a complete understanding of the asset’s investment characteristics.

If investors believe a market is highly efficient, they will usually accept market prices as accurately reflecting intrinsic values.

If investors believe an asset market is relatively inefficient, they may try to develop an independent estimate of intrinsic value

prices should adjust quickly and rationally to the release of new information

market participants.

Information Availability and Financial Disclosure

Limits to Trading

Transaction costs

Information-acquisition costs:

security prices fully reflect all past market data, which refers to all historical price and trading volume information.

In a semistrong efficient market, prices adjust quickly and accurately to new information.

In the strong form of efficient markets, security prices fully reflect both public and private information.

Fundamental Analysis

Technical Analysis

Portfolio Management

Calendar Anomalies

Momentum and Overreaction Anomalies

Size Effect

Value Effect

Closed-End Investment Fund Discounts

Earnings Surprise

Initial Public Offerings (IPOs)

Predictability of Returns Based on Prior Information