Financial Concept: Efficient Markets

The Efficient Market Hypothesis states that it is impossible for anyone (without inside information) to predict outcomes in the market, because share prices always reflect all known information. Although analysts who follow different industries and companies are paid to have the most up-to-date information and insight into the unique circumstances affecting the companies they follow, it is unlikely for anyone to be able to invest in a significantly undervalued stock or be able to sell a significantly overvalued stock. People who make these predictions are making educated guesses that may pay off, but they are still guesses.

Beware of anyone who contends that he knows what the market or any investment will do over a given period of time.