What looks like a small project turns into a big project. What looks like a big project turns into a small project. So I don’t think there’s been a lot of planning involved. At least in my case, there hasn’t been.
These words by Eugene Fama are for his work on Efficient Market Hypothesis. Even after enormous work in the fields of computers, finance, economics, corporate sector and so much so Nobel Prize 2003 nomination for economics, only EMH became his identity. His Ph.D dissertation in 1964 played havoc with entire investment advisory markets and it continues even today after 40 years. A theory named Random Walks became a cause of random talks in capital markets all over the world. Making investment in index funds and spending all research time on the beach enjoying holiday is an efficient way introduced by Fama.
The EMH is notionally based on the theory of random walks, which gives an idea of no prediction role of analysts and chartists in stock markets. The security price changes are not accurately predictable under any mechanical or technical method introduced by analysts well before and after EMH. The empirical testing of EMH helps to clarify this fact.
As per EMH, the stock markets are categorized into three types of weak, semi-strong and strong, and all such categories are based on information availability and its reflection in security prices. The existence of weak form market has just become a pretense in the modern world but its existence in the 19th century is not so far behind. The very existence of weak-form market laid the foundations of preliminary Dow Theory.
The Dow Theory has its origin back in 1884 when it was presented in anonymous editorials of The Wall Street Journal by its architect Mr. Charles Dow.