Do you think that professional investors can buy a risky portfolio that beats the market in the

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Do you think that professional investors can buy a risky portfolio that “beats the market” in the sense of outperforming portfolio M?

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While its theoretically possible for professional investors to buy a risky portfolio that outperforms the market portfolio portfolio M consistently achieving this outcome is challenging The Efficient Market Hypothesis EMH suggests that in an efficient market where information is rapidly and accurately reflected in prices it is difficult to consistently beat the market over the long term However there are a few considerations 1 Market Inefficiencies Despite the EMH markets may not always be perfectly efficient especially in the short term or in less liquid markets Professional investors may exploit inefficiencies such as mispriced securities or market anomalies to outperform ...View the full answer

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