The Efficient Market Hypothesis (EMH) is a financial theory suggesting that asset prices reflect all available information, making it nearly impossible to consistently achieve higher returns than average market returns.
Inefficiencies in the market occur when investors fail to recognize the true value or risks associated with a particular stock or bond. These inefficiencies contradict the Efficient Market Hypothesis (EMH), which posits that current prices reflect all available information about securities. However, discrepancies between theory and practice provide opportunities for arbitrageurs to profit from market inefficiencies
