Dan is a chemist for ABC, a major drug manufacturer. Dan cannot earn excess profits on ABC stock based on the knowledge he has related to his experiments if the financial markets are:.
1. strong form efficient.
2. semistrong form efficient.
3. weak form efficient.
4. aware that the trader is an insider.
5. efficient at any level.

2. Semi-Strong Form Efficient

Explanation:

Semi-strong form of market efficiency occurs when all publicly available information is reflected on security prices such that, earning additional return is not a possibility.

Here, Dan can not earn excess profits on ABC stocks because, if the financial market is semi strong form efficient, his experience on technical and fundamental analysis, which is based on how profit is generated and current information respectively, can not help to determine the price movement in the future.

Also, based on research, it is suggested that developed market are semi strong efficient, while developing markets are not semi strong efficient.

answer; swot analysis;