the market is weak form but not semi-strong form efficient, (3) ..
Is three forms of efficient market hypothesis (EMH) - Weak form, semi-strong form and strong form relevant and valid?
The hypothesis exists in three forms namely weak, semi-strong, ..
The strong-form EMH implies that the market is efficient: it reflects all information both public and private, building and incorporating the weak-form EMH and the semi-strong form EMH. Given the assumption that stock prices reflect all information (public as well as private) no investor would be able to profit above the average investor even if he was given new information.
Wage: The payment for the service of a unit of labor, per unit time. In trade theory, it is the only payment to labor, usually unskilled labor. In empirical work, wage data may exclude other compensation, which must be added to get the total cost of employment.
Wage-rental ratio: The ratio of the wage of labor to the rental price of either capital or land, whichever is the other factor in a two-factor Heckscher-Ohlin model. The ratio plays a critical role in this model since it determines the ratios of factors employed in both industries.
Waiver: An authorized deviation from the terms of a previously negotiated and legally binding agreement. Many countries have sought and obtained waivers from particular obligations of the GATT and WTO.
Walras' Law: The property of a general equilibrium that if all but one of the markets are in equilibrium, then the remaining market is also in equilibrium, automatically. This follows from the budget constraints of the market participants, and it implies that any one market-clearing condition is redundant and can be ignored.
Walrasian adjustment: A market adjustment mechanism in which price rises when there is excess demand and falls when there is excess supply. Strictly speaking, these excess supplies and demands are those that would obtain without any history of disequilibrium, as with a Walrasian auctioneer.
Walrasian auctioneer: A hypothetical entity that facilitates market adjustment in disequilibrium by announcing prices and collecting information about supply and demand at those prices without any disequilibrium transactions actually taking place.
Warehouse receipt: A receipt issued by a warehouse listing the goods received.
Warehouse-to-warehouse: An insurance policy that covers goods over the entire journey from the seller's to the buyer's premises.
Warrant: An option issued by a company that allows the holder to purchase equity from the company at a predetermined price prior to an expiration date. Warrants are frequently attached to Eurobonds. A relatively long-term option to purchase common stock at a specified exercise price over a specified period of time.
Water in the tariff: The extent to which a tariff that is higher than necessary to be prohibitive.
Weak form efficient market:A market in which prices fully reflect the information in past prices.
Wealth: The total value of the accumulated assets owned by an individual, household, community, or country.
Weight note: Document issued by either the exporter or a third party declaring the weight of goods in a consignment
Weighted Average Cost of Capital (WACC): The required return on the funds supplied by investors. It is a weighted average of the costs of the individual component debt and equity funds. A discount rate that reflects the after-tax required returns on debt and equity capital.
Welfare criterion: A basis, usually quantitative, for judging whether one state of the world or of an economy is better than another, for use in welfare economics and in evaluation of policies.
Welfare economics: The branch of economic thought that deals with economic welfare, including especially various propositions relating competitive general equilibrium to the efficiency and desirability of an allocation.
Welfare proposition: In trade theory, this usually refers to any of several gains from trade theorems.
Welfare state: A set of government programs that attempts to provide economic security for the population by providing for people when they are unemployed, ill, or elderly.
Welfare triangle: In a partial equilibrium market diagram, a triangle representing the net welfare benefit or loss from a policy or other change. In trade theory it often means the triangle or triangles representing the deadweight loss due to a tariff.
Welfare: Refers to the economic well being of an individual, group, or economy. For individuals, it is conceptualized by a utility function. For groups, including countries and the world, it is a tricky philosophical concept, since individuals fare differently. In trade theory, an improvement in welfare is often inferred from an increase in real national income.
Wharfage charge: A charge assessed by a pier or dock owner for handling incoming or outgoing cargo.
White knight: A friendly acquirer who, at the invitation of a target company, purchases shares from the hostile bidder(s) or launches a friendly counter bid in order to frustrate the initial, unfriendly bidder(s).
Willingness to pay: The largest amount of money that an individual or group could pay, along with a change in policy, without being made worse off. It is therefore a monetary measure of the benefit to them of the policy change. If negative, it measures its cost.
Wire transfer: A generic term for electronic funds transfer using a two-way communications system, like Fedwire.
Withholding tax: A tax on income that is levied at the source, thus diverted to the government before the recipient of the income ever sees it. Used in international tax treaties to assist tax collection. A tax on dividend or interest income that is withheld for payment of taxes in a host country. Payment is typically withheld by the financial institution distributing the payment.
Working capital management: The administration of the firm's current assets and the financing needed to support current assets.
Working capital: An accounting term that indicates the difference between current assets and current liabilities. The combination of current assets and current liabilities.
World Bank: A group of five closely associated international institutions providing loans and other development assistance to developing countries. The five institutions are IBRD, IDA, IFC, MIGA, and ICSID. As of July 2000, the largest of these, IBRD, had 181 member countries. International Bank for Reconstruction and Development. An international organization created at Breton Woods in 1944 to help in the reconstruction and development of its member nations. Its goal is to improve the quality of life for people in the poorer regions of the world by promoting sustainable economic development. See also International Bank for Reconstruction and Development.
World Fact Book: An excellent source of information about the countries of the world, including basic economic data.
World price: The price of a good on the world market, meaning the price outside of any country's borders and therefore exclusive of any trade taxes or subsidies that might apply crossing a border into a country but inclusive of any that might apply crossing out of a country.
World Trade Organization (WTO): The WTO is a multilateral organization that promotes free and fair trade among the nations of the world. It was created in 1995 by 121 nations at the Uruguay Round of the General Agreement on Tariffs and Trade (GATT). The WTO is responsible for implementation and administration of the trade agreement. A global international organization that specifies and enforces rules for the conduct of international trade policies and serves as a forum for negotiations to reduce barriers to trade. Formed in 1995 as the successor to the GATT, it had 136 member countries as of April 2000.
Worldwide tax system: A tax system that taxes worldwide income as it is repatriated to the parent company. Used in Japan, the United Kingdom, and the United States.
stock market was semi-strong-form efficient.
For about ten years after publication of Fama's classic exposition in 1970, the Efficient Markets Hypothesis dominated the academic and business scene. A steady stream of studies and articles, both theoretical and empirical in approach, almost unanimously tended to back up the findings of EMH. As Jensen (1978) wrote: ‘There is no other proposition in economics which has more solid empirical evidence supporting it than the EMH.’
If a market is semi-strong efficient, the current market price is the best available unbiased predictor of a fair price, having regard to all publicly available information about the risk and return of an investment. The study of public information (and not just past prices) cannot yield consistent excess returns. This is a somewhat more controversial conclusion than that of the weak-form EMH, because it means that analysis – the systematic study of companies, sectors and the economy at large – cannot produce consistently higher returns than are justified by the risks involved. Such a finding calls into question the relevance and value of a large sector of the financial services industry, namely investment research and analysis.
Efficient market hypothesis semi strong
Zero balance account (ZBA): A corporate checking account in which a zero balance is maintained. The account requires a master (parent) account from which funds are drawn to cover negative balances or to which excess balances are sent.
Zero-coupon bond: A bond that pays no interest but sells at a deep discount from its face value; it provides compensation to investors in the form of price appreciation. Semi-strong form efficient market A market in which prices fully reflect all publicly available information.
Zero profit: A situation in which profit in an industry is zero, usually as a result of free entry and exit. It may, if firms are not identical, refer only to the marginal firm. And it always means zero excess profit, not that all returns to capital invested in the industry are zero.
Zero substitution: An elasticity of substitution of zero. In a production function, this means a Leontief technology.
Zero sum game: A game in which the payoffs to the players add up to zero, so that a gain for one is necessarily equaled by loss to others. It contrasts with positive sum game.
Unbiased expectations hypothesis: The hypothesis that forward exchange rates are unbiased predictors of future spot rates. (See forward parity.)
Unbiased Nature of the Forward Rate (UFR): States that the forward rate should reflect the expected future spot rate on the date of settlement of the forward contract.
Uncertainty avoidance: The extent to which a society tolerates uncertainty and ambiguity.
Uncertainty: Lack of information. Failure to know anything that may be relevant for an economic decision, such as future variables, details of a technology, or sales. In models, uncertainty usually appears as a random variable and corresponding probability density function. But in practice, most international models, especially of trade, assume certainty.
Uncovered interest parity: Equality of expected returns on otherwise comparable financial assets denominated in two currencies, without any cover against exchange risk. Uncovered interest parity requires approximately that i = i* + a where i is the domestic interest rate, i* the foreign interest rate and the expected appreciation of foreign currency at an annualized percentage rate.
Underemployment: The employment of workers for fewer hours or in less desirable jobs than they would prefer and are qualified for.
Under-invoicing: The provision of an invoice that states price as less than is actually being paid. This might be done on an import in order to reduce the amount that will be collected by an ad valorem tariff. Or it might be done on an export to reduce apparent profit and thus taxes.
Under-valued currency: The situation of a currency whose value on the exchange market is lower than is believed to be sustainable. This may be due to a pegged or managed rate that is below the market-clearing rate, or, under a floating rate, it may be due to speculative capital outflows. It contrasts with over-valued currency.
Underwriting syndicate: A temporary combination of investment banking firms formed to sell a new security issue.
Underwriting: Bearing the risk of not being able to sell a security at the established price by virtue of purchasing the security for resale to the public; also known as firm commitment underwriting. The act by investment bankers of purchasing securities from issuers for resale to the public.
Unemployment Rate: The ratio of the total number of unemployed persons to the total number of persons in the labor force. The ratio of unemployment to the labor force of a country.
Unequal exchange: Trade in which the labor used to produce a country's exports is more than the labor used to produce its imports, as in the exchange between low-wage developing countries and high-wage developed countries.
1. Under the GATT this refers only to exports that are subsidized or dumped
2. Under U.S. law, this also includes various actions that interfere with U.S. exports.
3. Also used to refer to any almost any trade that the speaker objects to, sometimes including that based on low wages or weak regulations.
Uniform Commercial Code: The model state legislation related to many aspects of commercial transactions that went into effect in Pennsylvania in 1954. It has been adopted with limited changes by most state legislatures.
Unit contribution margin: The amount of money available from each unit of sales to cover fixed operating costs and provide operating profits.
Unit elastic: Having an elasticity equal to one. For a price elasticity of demand, this means that expenditure remains constant as price changes. For income elasticity it means that expenditure share is constant. Homothetic preferences imply unit income elasticities. It contrasts with elastic and inelastic.
Unit isocost line: An isocost line along which cost is equal to one unit of the numeraire, such as one dollar.
Unit isoquant: The isoquant for a quantity equal to one unit of a good. The unit isoquant is useful for relating the price of a good to the prices of factors employed in its production.
Unit labor requirement: The amount of labor used per unit of output in an industry; the ratio of labor to output. In a Heckscher-Ohlin Model this varies along an isoquant as different techniques are chosen in response to different factor prices. But in a Ricardian model, these are the constant building blocks for defining comparative advantage and determining behavior.
Unit of account: A basic function of money, providing a unit of measurement for defining, recording, and comparing value. I.e., one dollar signifies not only a one dollar bill, but also a dollar's worth of money in other forms (deposits), of wealth in other forms than money, and of any good or service with a market value.
United Currency Options Market (UCOM): Market set up by the Philadelphia Stock Exchange in which to trade currencies.
United Nations Organizations: The complex and extensive system of organizations that exist under the umbrella of the United Nations. Several of these, like the WTO and the IMF, play critical roles in the international economy.
Unit-value isoquant: The isoquant for a quantity of a good worth one unit of value. This is meaningful only if the nominal price of the good is given, for some specified currency or numeraire. Unit-value isoquants are central to the Lerner diagram for analyzing the Heckscher-Ohlin Model.
Universal Banking: Bank practice, especially in Germany, whereby commercial banks perform not only investment banking activities equity positions in companies.
Unlevered beta (systematic business risk): The beta (or systematic risk) of a project as if it were financed with 100 percent equity.
Unlevered cost of equity: The discount rate appropriate for an investment assuming it is financed with 100 percent equity.
Unnatural trading bloc: A trading bloc among countries that are not natural trading partners.
Unsecured loans: A form of debt for money borrowed that is not backed by the pledge of specific assets.
Unskilled labor: Labor with a low level of skill or human capital. Identified empirically as labor earning a low wage, with a low level of education, or in an occupational category associated with these; sometimes crudely proxied as production workers.
Unsterilized Intervention: Foreign exchange market intervention in which the monetary authorities have not insulated their domestic money supplies from the foreign exchange transactions.
Unsustainable debt: A financial condition in which a country is unable to service its foreign (external) debt without decimating its economy.
Unsystematic (Diversifiable) Risk: Risks that are specific to a given firm, such as a strike. Risk that is specific to a particular security or country and that can be eliminated through diversification.
Unsystematic risk: The variability of return on stocks or portfolios not explained by general market movements. It is avoidable through diversification.
Up-and-In Option: An option that comes into existence if and only if the currency strengthens enough to cross a preset barrier.
Up-and-Out Option: An option that is canceled if the underlying currency strengthens beyond the outstrike.
Upstream subsidization: Export of a good one of whose inputs has been subsidized.
Usury: The practice of charging or paying exorbitant interest on a loan or other transaction. Note: in Islamic societies, charging or receiving any amount of interest is considered usury.
Utility function: A function that specifies the utility (usefulness, well being) of a consumer for all combinations goods consumed (and sometimes other considerations). It represents both their welfare and their risk preferences.
Utility possibility frontier: In a diagram with levels of individual utility on the axes, a curve showing the maximum attainable levels of utility in a given situation, such as free trade or autarky.
Weak, Semi-Strong and Strong EMH - Investopedia
CFA Level 1 - Weak, Semi-Strong and Strong EMH
There are three levels, or degrees, of the efficient market hypothesis: weak, semi-strong, and strong.
Efficient-market hypothesis - Wikipedia
here are three major versions of the hypothesis: "weak", "semi-strong", and "str ong"
Investor Home - The Efficient Market Hypothesis
Answer to What are the differences among the weak, semi-strong, and strong forms of the efficient market hypothesis?
"I have always been impressed by the quick turnaround and your thoroughness. Easily the most professional essay writing service on the web."
"Your assistance and the first class service is much appreciated. My essay reads so well and without your help I'm sure I would have been marked down again on grammar and syntax."
"Thanks again for your excellent work with my assignments. No doubts you're true experts at what you do and very approachable."
"Very professional, cheap and friendly service. Thanks for writing two important essays for me, I wouldn't have written it myself because of the tight deadline."
"Thanks for your cautious eye, attention to detail and overall superb service. Thanks to you, now I am confident that I can submit my term paper on time."
"Thank you for the GREAT work you have done. Just wanted to tell that I'm very happy with my essay and will get back with more assignments soon."