Consistency of EMH and Random Walk Prices will change to reflect all relevant new information New information,by definition,is unpredictable. Therefore,price changes must be unpredictable PROBLEM:What information is relevant? 88 Consistency of EMH and Random Walk Consistency of EMH and Random Walk ƒ Prices will change to reflect all relevant new information ƒ New information, by definition, is unpredictable. ƒ Therefore, price changes must be unpredictable PROBLEM: What information is relevant?