The Individual Investor in the Market

Forming a Belief Regarding Market Efficiency

Authors

  • Robert M. Peevey Department of Finance, University of Houston, Houston, TX, 77204-6282
  • Gene C. Uselton Department of Finance, Texas A&M University, College Station, TX, 77843-4218
  • John R. Moroney Department of Economics, Texas A&M University, College Station, TX, 77843-4218

DOI:

https://doi.org/10.1016/1057-0810(92)90004-V

Abstract

Do the actions of investors drive the market toward efficiency or do investors utilize fads and other information unrelated to the true value of the security to drive the market away from eficiency? Investors have been forced to examine a multitude of challenges to the eficient markets hypothesis in recent years. One of the most formidable of the challenges is the “excessive market price volatility” argument. We examine this argument, as presented in the “variance bounds” literature, and conclude that, although markets may be ineficient, the “variance bounds” literature has not proved the case conclusively.

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Published

1992-12-30

How to Cite

Peevey, R. M., Uselton, G. C., & Moroney, J. R. (1992). The Individual Investor in the Market: Forming a Belief Regarding Market Efficiency. Financial Services Review, 2(2), 87–96. https://doi.org/10.1016/1057-0810(92)90004-V

Issue

Vol. 2 No. 2 (1992): Financial Services Review

Section

New Original Submission

License

Copyright (c) 1992 JAI Press Inc.

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