In recognition of his contributions to asset pricing theory, Eugene Fama was awarded the Nobel Prize in Economic Sciences in Fama is a University of Chicago professor of finance, and is widely viewed as the "Father of Modern Finance. However, the study determined no such advantage existed beyond that attributed to chance alone. In , Fama published his Efficient Market Hypothesis in "Efficient Capital Markets: A Review of Theory and Empirical Work," 2 in which he concluded equity markets consistently incorporate all available information into their prices, and trends in capital markets cannot be identified in advance.

He found that an agreement between a buyer and a seller reflects the most accurate value of a security, resulting in an environment where the only way an investor can expect to beat the market return is by taking risk greater than the market.

Eugene Fama and Kenneth French's paper, "The Cross-Section of Expected Stock Returns," 3 expanded upon the Nobel Prize-winning research of Harry Markowitz and William Sharpe that delivered Modern Portfolio Theory. Their discoveries serve as the foundation for constructing indexes that efficiently capture risks and returns based on five independent risk factors, including term and default for fixed income.

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The Behavior of Stock-Market Prices. | Raptis Rare Books

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The Behavior of Stock-Market Prices on JSTOR

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Risk Capacity Step Risk Exposure Step IFA Steps Step 2 - Efficient Markets. Fama, "The Behavior of Stock Market Prices," The Journal of Business, vol.

Fama, "Efficient Capital Markets: A Review of Theory and Empirical Work," The Journal of Finance, vol. Fama and Kenneth R. French, "The Cross-Section of Expected Stock Returns," The Journal of Finance, vol.

Table of Contents 1. Investors Rely on Lady Luck 3.

Center for Research in Security Prices 4. The Nobel Prize in Economics 5.

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