Efficient market hypothesis Essay Example | Topics and Well Written Essays - 500 words

Efficient market hypothesis - Essay Example For the case of semi-strong form, the prices of securities depend on the present and past information and not on the future expected information. Finally, the strong form contend that the prices of securities in the market reflect all the information i.e. past, present and future and that this information is in the domain of all the investors (Schwert 21). There is no opportunity to make abnormal returns in a strong market. The strong market supports the efficient market hypothesis, as it is this form where investors are never in a position to make abnormal profits without incurring higher risk. The other two forms: weak and semi-strong form fails to support the EMH because not all investors are privy to all the information about the market and therefore some investors are in a position to make above average rate of return without taking above average risks (Schwert 23). I however believe that there is no efficient market. This is because the assumption in which the EMH is hinged are ideal i.e. that there are no transaction costs, that all investors have all past, present and future information and that the stock markets are efficient. These assumptions are idyllic and unattainable. Markets can therefore be in either the weak or semi- strong form in which case some investors have more information than others can. This can be shown from the many cases in which those in management positions have used ins ider information. Economists and psychologists in the behavioral finance sector however argue that in the short run, efficient markets are unattainable. This is because the prices of securities are influenced by other psychological factors like those that the expectation in future prices. They further assert that security prices cannot be disseminated equally because of the bandwagon effect. Investors will therefore consider other factors in the

Waste Assignment Example | Topics and Well Written Essays - 250 words

Waste - Assignment Example ghts the environmental effects caused by extensive use of plastic bags, possible proposed plans of eliminating their use and economic impacts of implementing these plans as well as the financial aspect. Plastic bags pose dangers to animals. Notably, this occurs when plastic bags find their ways into their feeding areas, and mistake them for food especially when residues are present in the bag. Death results in the event of swallowing (Hope, 1998). Secondly, extensive use of these bags causes litter problems, thereby reducing aesthetic value of our environment (Hester and Harrison, 2002). In conclusion, retailers give carryout plastic bags to buyers at no cost. However, they purchase plastic bags at a particular cost spending much more than the cost of operation. Implementation of my proposed plans ensures that retailers save the collected fees to buy a unit of plastic bag than that of paper (Cheremisinoff,