Problem:
One basic investing tenet is that prices appreciate to reflect the earnings power of a stock. Fast growing stocks should therefore outperform slow growing stocks. Suppose we classify stocks into 2 categories today: high growth stocks and low growth stocks.
We can then form two groups of stocks that have the same beta - a group of high growth stocks and a group of low growth stocks. In an efficient market, the group of high growth stocks is expected to provide a higher expected return than the group of low growth stocks.
Question: Clearly state whether the above statement (in italics) is 'true' or 'false'.