n NISM Certifications
XXI NISM Series XXI-A
Medium

Which of the following is a characteristic of an efficient market?

Practice question from NISM XXI A for PMS - Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. Prices always reflect all available information

    Correct answer

  2. B

    It is possible to consistently outperform the market

  3. C

    Stock prices are driven solely by irrational behavior

  4. D

    Information is only partially reflected in stock prices

Why this is the answer

Efficient markets incorporate all known information into prices.

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