Wednesday, September 16, 2009

The price is right and the EMH

The Guardian has a short article talking about two components of the EMH (Efficient Market Hypothesis).

The conclusion is slightly amusing.
But that still leaves the first part of EMH intact; that you can't beat the market unless you have insider information. It implies that most of us are better off stowing our savings in a cheap fund that tracks the stock market, rather than with some expensive smarty-pants fund manager. There you go, an idea from economics that might save you money: who'd have thought it?