What is the evidence that market learn slowly? There are three categories of studies that are relevant to answering this question. The first set look at stock prices over time to see if they reveal a tendency to move in the same direction for extended periods of time. The second set look at how markets react to news about the firm - earnings and dividend announcements, for instance - and how prices adjust to the new information. The final set looks at mutual funds and whether there is evidence that mutual funds that have done well in the past continue to do so in the future.
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