Financial Markets with Robert Shiller: 6. Efficient Markets vs. Excess Volatility (26 lectures, Yale)

Financial Markets (ECON 252) Several theories in finance relate to stock price analysis and prediction. The efficient markets hypothesis states that stock prices for publicly-traded companies reflect all available information. Prices adjust to new information instantaneously, so it is impossible to “beat the market.“ Furthermore, the random walk theory asserts that changes in stock prices arise only from unanticipated new information, and so it is impossible to predict the direction of stock prices. Usin