1. Introduction: The Modern investment theory and its application is predicated on the Efficient Markets Hypothesis (EMH), the assumption that markets fully and instantaneously integrate all available information into market prices. Underlying this comprehensive idea is the assumption that the market participants are perfectly rational, and always act in self-interest, making optimal decisions. These assumptions […]
INTRODUCTION: Much of modern investment theory and practice is predicated on the Efficient Markets Hypothesis (EMH), the assumption that markets fully and instantaneously integrate all available information into market prices. Underlying this comprehensive idea is the assumption that the market participants are perfectly rational, and always act in self-interest, making optimal decisions. These assumptions have […]
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Get started1. Introduction The Modern investment theory and its application is predicated on the Efficient Markets Hypothesis (EMH), assumption that markets fully and instantaneously integrate all available information into market prices. Underlying this comprehensive idea is the assumption that market participants are perfectly rational, and always act in self-interest, making optimal decisions. These assumptions have been […]
Some investors are curious about whether there is a disposition effect in the real world. The matter has been settled, since there is obvious empirical evidence to support an occurrence of the disposition effect in the markets, including stock markets. However, underlying causes for it are still ambiguous. Some claim that the disposition effect could […]
