WEAK FORM EFFICIENCY - TESTING EFFICIENT MARKET HYPOTHESIS BASED ON ASIAN PAINTS LTD

Abstract

The market, according to efficient market theory, can be divided into three categories: weak form efficiency, semi-strong efficiency, and strong efficiency. This divide represents the fundamental premise that the "market" is continually changing as a result of information flow. Despite being a cornerstone of modern financial theory, the EMH is very contentious and frequently contested. According to believers, looking for cheap companies or attempting to predict market moves through fundamental or technical research is pointless. The goal of this paper is to analyse the Random Walk Theory, a weak variation of effective market theory, on Asian Paints Ltd on a weekly basis from May14, 2020 to May 14, 2023.   The purpose of this research is to put Random Walk Theory, a typical weak variant of efficient market theory, to the test.The Serial Correlation Test was used to investigate the weak version of efficient market theory.  Based on the initial difference on the NSE, it is concluded that Asian PaintsLtd does not follow a random walk and that the market is not efficient in its current structure.