TA - CHAPTER 2.3 - RWT & EMH

What is another name for Weak Form EMH?

• Market Anomalies

• Random Walk Theory

• Strong EMH

• Semi Strong EMH

Which form of Efficient Market Hypothesis suggests that security prices reflect all past market data?

• Market Anomalies

• Strong EMH

• Semi Strong EMH

• Weak Form EMH

What is the tendency of stocks to exhibit relatively large returns on Fridays compared to those on Mondays called?

• Announcement effect

• Calendar (weekend effect)

• Market Anomalies

• Small firm effect

What type of companies are more likely to outperform larger companies based on the text?

• Underperforming companies

• Robust companies

• Compact companies

• Intermediate companies

What does the Announcement effect refer to?

• Stock splits

• Earnings

• Mergers and acquisitions

• All of the above

Which form of Efficient Market Hypothesis suggests that security prices reflect all available information including public and private data?

• Strong EMH

• Weak Form EMH

• Market Anomalies

• Semi Strong EMH

What is the main idea behind the Random Walk Theory?

• Stock prices are always decreasing

• Stock prices are always increasing

• Stock prices move randomly

• Stock prices follow a predictable pattern

What is the term used for situations when a security or group of securities performs contrary to the idea of efficient markets?

• Market Anomalies

• Efficient Market Hypothesis

• Random Walk Theory

• Stock Splits

Which effect refers to the abnormal return earned by stocks of small firms compared to large firms?

• Market Anomalies

• Small firm effect

• Calendar (weekend effect)

• Announcement effect

What is the term used for the phenomenon where stock prices tend to move in the same direction?

• Positive correlation

• Arbitrage

• Volatility

• Regression analysis