Opinion on Efficient Market Hypothesis
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Given the current turmoil in the financial markets, do you believe the stock market is an efficient market?
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Solution Summary
Brief opinion on why the efficient market hypothesis is no longer valid.
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In my opinion today's financial markets are not efficient and the turmoil in the financial markets is just one example of why. When you look at the market efficiency hypothesis and its roots you start to understand why it isn't valid in the 21st century. The biggest reason is that investors have access to information 24 hours per day and 7 days per week. Never in the history of equities markets have investors had so much immediate access to news and information. Another key phenomenon is the ability to act on that information. There are dozens of online trading platforms that allow investors to make trading decisions based on this information. These two phenomenon are why the efficient market hypothesis is no longer ...
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