Efficient Market Hypothesis
EMH is a theory that suggests financial markets are efficient and incorporate all available information into asset prices.
According to the EMH, it is impossible to consistently outperform the market by employing strategies such as technical or fundamental analysis. The hypothesis argues that since all relevant information is already reflected in stock prices, it is not possible to gain an advantage and generate abnormal returns through stock picking or market timing.
The weak form of EMH posits that all past market prices and data are fully reflected in current stock prices.
Therefore, technical analysis methods, which rely on historical data, are deemed useless as they cannot provide investors with a competitive edge. This is why they consider successful daytrading a phenomenon and why the success percentage is around .10-.50%.
Therefore, technical analysis methods, which rely on historical data, are deemed useless as they cannot provide investors with a competitive edge. This is why they consider successful daytrading a phenomenon and why the success percentage is around .10-.50%.
The semi-strong form of EMH extends beyond historical prices and suggests that all publicly available information is instantly priced into the market. We know this to not be true because there are plenty of times news is released and the stock does nothing.
For individual investors, EMH suggests that "beating the market" consistently is virtually impossible. The reasoning behind this is in the fact that the people running the market make the rules for the market. So when they see investors start beating the market they will adjust these rules in order to stop this advantage.
The reason technical analysis has trouble working is because the information released is done unevenly which causes the reading of it to be in error and difficult to apply to stock movement.
Now if they believe this theory is true then the fact that they allow daytrading would make their market unethical and their practices as deceptive. More or less they should be considered thieves by allowing 99.5% of daytraders to invest knowing they will suffer losses.
What is worse is they will even allow rules to be broken as long as the investor is breaking even or losing money. But as soon as that investor starts making large gains they will then come in and use rule violations to hinder or even stop the financial gains.
This is what has happened to me. In the last quarter(3 months) my account is up 502%. When an account has this large of gains and the investor is rolling these large investment gains into stocks it starts setting off alarms because now they are able to cause price movements. So in order to stop this they will then start enforcing rules that they werent previously because they werent losing money. Allowing the rules to be broken when they already control my buying and selling is manipulation because they could stop any investing moves before I break a rule since they have the control. Instead they allow the rule to be broken without giving even a warning.
The good news is that this just pisses me off and makes me more determined to beat their market theory. So my picks this week are:
$Primega Group (PGHL.US)$ Bought shares at 7.00-9.89. Holding for a breakout over 20.00-30.00.
$Nuburu (BURU.US)$ Bought at .62 Friday. Holding for 100% gains at 1.34.
$FibroBiologics (FBLG.US)$ Bought at 1.89. Holding for breakout to 3.50. Broke resistance Friday.
$Tivic Health Systems (TIVC.US)$ Have started buying slowly. Looking for a breakout to happen near the end of the month after the 23rd. Stop-loss set at .28.
$Santech Holdings (STEC.US)$ Going to start buying this week. Price goal is 1.50.
$Fitell (FTEL.US)$ Also buying this week. Price goal of 25.00. Stop-loss set at 12.33.
Ready to see some big gains. Hope you get rich!
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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QMengColdJoke : that’s for long term. Fun part is a bubble can last 2 to 3 years before blowing up to ashes. A very profitable company can be very cheap only for a few months
Mcsnacks H Tupack OP QMengColdJoke : Not necessarily. EMH implies that active management strategies are unlikely to outperform passive strategies consistently. It discourages the pursuit of "undervalued" stocks or timing the market. Active management has excessive trading involved in it.
EMH is the driving force behind the rise of passive investing, which is long term, in for example ETF's or index funds.
EMH with high-frequency trading and algorithmic trading are thought to have made it so all efforts,long or short term, to beat the market are futile.