SELF IMPROVEMENT

efficient market hypothesis
The efficient markets hypothesis claims financial and industry markets quickly incorporate economic conditions, and market forces into the prices of financial instruments, an example of which are stocks. In an efficient market, financial strengths and weaknesses are quickly discovered, and then rectified via adjusted pricing.
efficient markets hypothesis is essentially comprised of the same underlying principle, i.e. financial markets are adept and quick at finding value therefore value, whether it be high or low, quickly becomes adjusted for through financial product pricing mechanism.
• How the efficient markets hypothesis works
Over time a pattern emerges and the prices adjust automatically based on historical information making the market efficient.
Market efficiency claims the information about the information will quickly spread throughout the network of agriculturalists, and markets thereby affecting price accordingly and that all prices include relevant information regarding a commodity or product.
• What market efficiency means for businesses and consumers

Since markets are efficient according the efficient market hypothesis, then 1) prices are always if not mostly reflective of current events, information and historical patterns, and 2) due to this efficiency, outperforming the market over time in terms of pricing, cannot be achieved since businesses cannot be more efficient than the market as a whole.