According to Aswath Damodaran, In order for markets to be more efficient, the following three conditions must exist:
1. If trades can’t be executed then markets will be inefficient. Thus, trading should be “both inexpensive and easy.”[i]
2. Information about the firms should be wide, deep and freely available.
3. Caveat Emptor: Buyers should reap the rewards and suffer the slides of an investment.
_____________________________________________________________________________
Building a Small Business That Warren Buffett Would Love,available atAmazon.comorBarnesandNoble.com.
The over-arching vision of Building a Small Business That Warren Buffett Would Loveis to create
One Million Jobs.
Like us on Facebook to find out how you can support this mission!
[i] Damodaran, Aswath. Applied Corporate Finance, p 42, John Wiley and Sons, 2006, Hoboken, New Jersey
Posts
