Page 154 - A Canuck's Guide to Financial Literacy 2020
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Example of Strong Form Efficiency
Example of a semi-strong form market efficiency would be when current employment job
data is released and the market would act accordingly and adjust as the information is
absorbed. If the job data is positive, then markets should move up.
Strong Form Efficiency
In a strong form efficient market, all information whether publicly available or private is fully
reflected in a price of a security. Even insiders of public companies are not able to produce
excess return. This is the most extreme form of market efficiency and most studies have
found that markets are not efficient in this sense.
