The Efficient Market Hypothesis in action

Posted on September 13, 2008

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One of the more interesting and hotly debated concepts in finance is the efficient market hypothesis, which “assumes that all important information regarding a stock is reflected in the price of that stock.” (Definition courtesy of Brigham’s 12 edition textbook.) Personally, I’m not exactly sure where I fall on this argument, thought it’s clear that barriers drop daily as technology continues to transfer information at a faster and faster rate.

That said, I have a little chuckle about this article regarding United Airlines and its stock price after an old news release seeped into the regular news cycle.



Digg!

Posted in: finance