capital market efficiency


An analysis of the efficiency of capital markets. This looks at how fair current market prices are for an asset given current market situations. For example, if major news breaks out for a company, an analysis would occur on the stock's price to see how it should be valued given the news. Capital market efficiency measures the extent of the accuracy of the stock's price.

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The mathematician and the statistician worked tirelessly to find the capital market efficiency at the end of the fiscal quarter.

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In order to ensure such a large investment was being made at a fair price, it was necessary to hire an external expert on capital market efficiency.

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The rating agency had downgraded the company's bonds based on a report earlier in the week, but because of capital market efficiency, the markets didn't move because that information had been priced in when the report came out earlier.

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capital market Efficient Market Theory