Introduction The efficient markets hypothesis (or EMH as it is known) and its predecessor, the random walk theory, are perhaps the most misunderstood concepts in the theory of investment. This is due partly to the back-to-front way in which the theory of efficient markets has evolved and partly to the misleading and emotive statements often ascribed to these theories, for example; 'Investment analysis is a total waste of time' and 'No one can beat the …showed first 75 words of 19553 total…

…showed last 75 words of 19553 total…'GSK Back in Rude Health', The Scotsman, 4th June 2004. Vaitilingam, R. (2001) The Financial Times Guide to Using the Financial Pages, 4th ed., Harlow: FT Prentice Hall. Yahoo!Finance. (2004) UK Charts. Available at http://uk.finance.yahoo.com (Accessed: 1st September 2004) Zarowin, P. (1989) 'Short-Run Market Overreaction: Size and Seasonality Effects', Journal of Portfolio Management, Vol. 15, Issue 1, pp. 26-29. Zarowin, P. (1990) 'Size, Seasonality, and Stock Market Overreaction', Journal of Financial and Quantitative Analysis, Vol. 25, Issue 1, pp. 113-125.