Burton Malkiel, professor of economics at Princeton University, is the author of A Random Walk Down Wall Street and is currently preparing the tenth edition of the book. In a recent Financial Times interview, Mr. Malkiel insists that the data continue to indicate that markets are efficient despite the turmoil of recent years. He has found that the majority of active investors continue to underperform passive index funds over long periods of time. In addition, his research indicates that the passive approach provides better results even in emerging markets such as China. Read this article for more details and a link to the video.
While the EMT is often ridiculed as being obviously false, academics have attempted to adjust the theory over the years and it is now very rare to encounter anyone who believes in the strong-form version of the theory. Most academics believe in the semi strong-form of the theory which states that all publicly available information regarding a firm’s prospects must be reflected in the stock price. The weak-form hypothesis, which implies that technical analysis is of no value, is widely accepted by most security analysts including many value investors. Read this article for more on the EMT.