In an efficient market, a security's price fully reflects which of the following?Group of answer choicesThe equilibrium return of the securityOnly insider informationThe expected capital gain of the securityThe opinions of financial analysts
Question
In an efficient market, a security's price fully reflects which of the following?Group of answer choicesThe equilibrium return of the securityOnly insider informationThe expected capital gain of the securityThe opinions of financial analysts
Solution
In an efficient market, a security's price fully reflects all publicly available information. This includes the equilibrium return of the security, the expected capital gain of the security, and the opinions of financial analysts. However, it does not include insider information, as this is not publicly available. Therefore, in an efficient market, a security's price fully reflects the equilibrium return of the security, the expected capital gain of the security, and the opinions of financial analysts, but not only insider information.
Similar Questions
According to the efficient market hypothesis, prices of securities in financial markets fully reflect which of the following?Group of answer choicesPrivate informationAll available informationLimited informationOnly past information
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