Efficient Market Hypothesis
a.k.a. EMH
The theory that market prices already reflect all available information, so consistently beating the market is extremely hard.
The efficient market hypothesis, associated with economist Eugene Fama, says prices absorb information almost instantly. If everyone already knows something, it is already in the price.
There are weak, semi-strong and strong versions, depending on how much information is assumed to be priced in. Critics point to bubbles, crashes and behavioural quirks as evidence that markets are not perfectly efficient. Either way, it is a useful humility check: your edge has to come from somewhere.
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