Comments on: The market is not efficient

By: investoralist

investoralist — Wed, 10 Jun 2009 00:34:09 +0000

I think the thing is that, people generally believe in a weak version of the efficient market theory, without which, few investors would invest in the stock market.

So in a way, traders are theoretically in the market to make it more efficient. But when they collude, or rely on private information to trade, then we get the opposite result.

By: Shaun

Shaun — Wed, 10 Jun 2009 00:20:43 +0000

I don't think anyone trustworthy would argue that the market is completely efficient. Nothing is completely efficient save the laws physics themselves.

That said, I'm going to make a blind guess, and suggest the huge leap towards the end was caused, at least in large part, by day traders trying to surf the surge. I dislike day traders.

By: investoralist

investoralist — Tue, 09 Jun 2009 18:34:09 +0000

I think the thing is that, people generally believe in a weak version of the efficient market theory, without which, few investors would invest in the stock market.

So in a way, traders are theoretically in the market to make it more efficient. But when they collude, or rely on private information to trade, then we get the opposite result.

By: Shaun

Shaun — Tue, 09 Jun 2009 18:20:43 +0000

I don't think anyone trustworthy would argue that the market is completely efficient. Nothing is completely efficient save the laws physics themselves.

That said, I'm going to make a blind guess, and suggest the huge leap towards the end was caused, at least in large part, by day traders trying to surf the surge. I dislike day traders.