Describe the three forms of the efficient-market hypothesis {EMH} and discuss
the implications of EMH to security returns and trading strategies(20%) 12

Critically discuss in words the overall implications to EMH from the findings of Hung and Banerjee {HB 2014, EH 2013 and BH 2011}  Your discussions should draw evidence and arguments from each of the above three BH papers {30%)

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Arbitrage profits An investor told are risk less profits. You take simultaneous but opposite positions in two markets to reap gains from pricing disparities. Acting on this belief, his friend tried to find the arbitrage profit by trading simultaneously in futures and stock index.He has collected to the following information:âPricing level of stock index _- 3000 Index futures priced at 2000 Risk free rate of return – l0%p.a.• 50% stocks are to pay dividcnds at 6% The index futures has a multiple of 100• The future has six months to expiration.Required(

a) Find arbitrage profits, if any.

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