Define: Efficient Markets Hypothesis

UK Accounting Glossary

Definition: Efficient Markets Hypothesis


Quick Summary of Efficient Markets Hypothesis


Share prices in a stock market react immediately to the announcement of new information.



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Full Definition of Efficient Markets Hypothesis


The Efficient Market Hypothesis (also known as EMH) is an investment theory whereby share prices reflect all information and consistent alpha generation is impossible.


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Definition Sources


Definitions for Efficient Markets Hypothesis are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • BusinessDictionary.com
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 23rd December 2018.