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Market efficiency

C/F/748. Dissertation. Validity of Efficient Market Hypothesis in the USA during the internet bubble

WORDS:

10750

DATE:

2010

PRICE:

109.99 GBP

The dissertation explains the concept of Efficient Market Hypothesis (EMH), a theory proposed several decades ago by economists who argued that average investors would not be able to make abnormal returns in the longer run by investing in stocks. This was explained by observations that the behaviour of share prices is random and all information that is currently available to the market is already included in the share price. The research sets out to understand EMH and analyse the reasons for the appearance of the US internet bubble. But the paper also shows in its Literature Review on the subject, how in the 1990s the theory’s assumptions and accuracy were disputed – with academic critiques by Shleifer (1990), Shefrin (1988) and Thaler (1994) cited. The performance of internet companies is examined (the fluctuations of share prices of companies after announcements of dot.com name changes) as is the efficiency of the US market during the internet bubble. A blend of quantitative and qualitative research is used, and secondary statistical data on share prices – in this case a sample of the share values of ten companies.

KEYWORDS: Dissertation, Efficient Market Hypothesis (EMH), investing in stocks, share prices, internet bubble, US economy,