Problem
The additional information below was extracted from the minutes taken at a board meeting of Hathway plc where the company was communicating with its investors.
Mr Abbot: 'Share prices change every minute, and so every investor is keen to know the future price trends of the shares of a company so as to make investment decisions rationally. For this purpose, we, the ordinary investors, think that fundamental analysis and technical analysis is useful to forecast price trends in the future and earn extra returns.'
Mr Clark: 'We are a relatively small firm, and previous evidence suggests that smaller firms' shares outperform those of larger firms over a period of several years. Therefore, I have confidence that our firm's shares will be attractive to investors. I believe certain tradable anomalies seem to persist in the stock market.'
Mr Avory: 'According to the Efficient Market Hypothesis, any new information is rapidly incorporated into share prices. However, there could be an inefficient market response to firm announcements if we relax the efficiency assumption.
Task
With reference to academic literature, critically discuss the comments made by Mr. Abbot, Mr. Clark and Mr. Avory at the board meeting.