1. According to the Efficient Market Hypothesis Weak form and semi-strong form, there is really no way to get a better than market return, even when companies spend thousands and perhaps millions of dollars trying to create that edge through research. My question is about behavior finance and analytics. I currently use an analytics website that analyzes the voting of state and federal legislators based on analytics. If I were to look up a piece of legislation they could tell me with reasonable certainty how likely it is to pass based on the past of the sponsor, the people in the committee, the type of bill it is and what those people have voted on those things before, and many, many more things. Some have already begun to apply the behavioral finance theory to corporate finance decision making. I'm wondering, do you think an analytics system could be created to analyze the behaviors of corporations and Boards and management that could fairly accurately predict their future financial behaviors? Would this give an investor an advantage?

2. In general, the Efficient Market Hypothesis (EMH) theory contends that since markets are efficient and current prices reflect all information, attempts to outperform the market are essentially a game of chance rather than one of skill.

Explain the rational of how all information is available and efficient? How could someone analyze and conclude the information they are looking at is accurate?

3. During the “2008 Financial Crisis,” many of the traditional financial theories like the EMH have been questioned on if it’s the practical for what the markets are now verses couple decades ago. “If all the assumptions about efficient markets had held, then the housing bubble and subsequent crash would not have occurred. Yet, efficiency failed to explain market anomalies, including speculative bubbles and excess volatility. As the housing bubble reached its peak and investors continued to pour funds into subprime mortgages, irrational behavior began to precede the markets. Contrary to rational expectations, investors acted irrationally in favor of potential arbitrage opportunities. Yet an efficient market would have automatically adjusted asset prices to rational levels”.

My question is besides its failure to address financial downturns in the EMH theory, how has social media and the internet played a part in investor’s decision making on what investments on making assumptions?