Why financial markets are inefficient

Roger E. A. Farmer 22 January 2013

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Writing in a review of Justin Fox’s book The Myth of the Efficient Market, Richard Thaler (2009) has drawn attention to two dimensions of the efficient markets hypothesis, what he refers to as:

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Topics:  Financial markets Macroeconomic policy

Tags:  efficient market hypothesis, Finance, first welfare theorem, market fluctuations

New light on choice of investment strategy

Dimitri Vayanos, Paul Woolley 18 January 2012

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January finds many pondering the issue of what to do with their savings in the new year. There are two primary and distinct techniques of asset management: momentum and fair value.

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Topics:  International finance

Tags:  investment, efficient market hypothesis, investment strategy

Capital market theory after the efficient market hypothesis

Dimitri Vayanos, Paul Woolley 05 October 2009

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Forty years have passed since the principles of classical economics were first applied formally to finance through the contributions of Eugene Fama (1970) and his now-renowned fellow academics. Over the intervening years, capital market theory and the efficient market hypothesis have been developed and modified to form an elegant and comprehensive framework for understanding asset pricing and risk.

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Topics:  Financial markets

Tags:  asset pricing, Behavioural economics, efficient market hypothesis

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