The Efficiency Of Financial Market

If the prices of the shares or securities reflect the history of its price, then this comes under weak form efficiency. These forms of market will have the opportunity to predict the future price values.
In this form of market, only investors who have in-depth information of the market could earn more. All the publicly available information will reflect the share or security price.

Here, all of the public and in depth information have an impact on the asset price. This form of market will be completely unpredictable. There will be no information available for investors to research and invest on shares which produce better advantage. Because of this, no one can rule the market and the price prediction is extremely difficult.
1. Information arbitrage efficiency:
Here, prices reflect the public information available. Financial instruments can be used efficiently to generate profit. The information used for trading will be available at no cost. Investors have more opportunity to predict the market price. So, this type of efficiency is close to weak efficiency model.
2. Fundamental valuation efficiency:
In this type, future flow of payments has an effect on the market price. It has both high risk and high profit opportunities. If invested wisely, this type could return more profit. This type of market can be said as a semi-strong efficiency model.
The flow of products and the services would be continuous
4. Functional or operational efficiency:
In this type of efficiency, the products and services will be available for a low price and the investors directly have an advantage over the price.