On the Efficiency of Competitive Stock Markets Where Trades Have Diverse Information TOR Sanford grossman Journal of finance, Volume 31, Issue 2, Papers and Proceedings of the Thirty-Fourth Annual Meeting of the American Finance Association Dallas, Texas December 28-30 1975(May,1976),573-585 Your use of the jStor database indicates your acceptance of jSTOR's Terms and Conditions of Use. A copy of UsTor'sTermsandConditionsofUseisavailableathttp://www.jstor.ac.uk/about/terms.htmlbycontacting JSTOR at jstor@mimas. ac uk, or by calling JSTOR at 0161 2757919 or(FAX)0161 275 6040. No part of a JSTOR transmission may be copied, downloaded, stored, further transmitted, transferred, distributed, altered, or therwise used, in any form or by any means, except: (1)one stored electronic and one paper copy of any article solely for your personal, non-commercial use, or(2)with prior written permission of jSTOR and the publisher of the article or other text Each copy of any part of a STOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission Journal of finance is published by American Finance Association. Please contact the publisher for further permissions regarding the use of this work. Publisher contact information may be obtained at http://www.jstor.ac.uk/journals/afina. nal of finance 76 American Finance Association jSTOR and the jStor logo are trademarks of JSTOR, and are registered in the u.s. Patent and Trademark Office For more information on JSTOR contact jstor@mimas. ac uk @2001 JSTOR http:// on feb2620:11:402001