Is the Stock Market Efficient?

Science  10 Mar 1989:
Vol. 243, Issue 4896, pp. 1313-1318
DOI: 10.1126/science.243.4896.1313


A stock market is said to be efficient if it accurately reflects all relevant information in determining security prices. Critics have asserted that share prices are far too volatile to be explained by changes in objective economic events—the October 1987 crash being a case in point. Although the evidence is not unambiguous, reports of the death of the efficient market hypothesis appear premature.