11.5 Weak-Form market Efficiency e This asserts that it is impossible to produce consistently superior returns with a trading rule based on the past history of stock prices. In other words technical analysis does not work e A Markov process for stock prices is clearly consistent with weak-form market efficiency Options, Futures, and Other Derivatives, 5th edition C 2002 by John C Hull11.5 Options, Futures, and Other Derivatives, 5th edition © 2002 by John C. Hull Weak-Form Market Efficiency • This asserts that it is impossible to produce consistently superior returns with a trading rule based on the past history of stock prices. In other words technical analysis does not work. • A Markov process for stock prices is clearly consistent with weak-form market efficiency