... as one in which security prices fully reflect all available information. The market is efficient if the reaction of market prices to new information should be instantaneous and unbiased. Efficient market hypothesis is the idea that information is quickly and efficiently incorporated into asset prices at any point in time, so that old information cannot be used to determine future price movements, in an efficient market no trader will be presented with an opportunity for making an abnormal return, expected by chance. 1.2 Types of Efficiency There are three types of efficiency:: Operational efficiency, Allocational efficiency and pricing efficiency. * Operational efficiency: It refers to the cost to buyers and sellers of transactions in securities on the exchange. Competitions are created as much as possible between marketmakers and brokers so that they earn only normal profits but not excessively high profits. Similar competitions will also occur in the secondary exchange market. * ...

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