Investments, 11th Edition (exclude Access Card)
Investments, 11th Edition (exclude Access Card)
11th Edition
ISBN: 9781260201543
Author: Zvi Bodie Professor; Alex Kane; Alan J. Marcus Professor
Publisher: McGraw-Hill Education
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Chapter 11, Problem 8PS
Summary Introduction

To construct:

Why do investors earn positive returns from the market on average if prices can increase or decrease.

Introduction:

Efficient market hypothesis (EMH)

defines that the stock prices reflect fair market value incorporating all the relevant available information in market. As per EMH hypothesis, to earn higher profits an investor must invest in riskier assets that have high stock beta.

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