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As mentioned above, I was lucky in 1978 when Citibank asked me to manage a portfolio for the
brokerage house Bache, which wanted to offer a high yield bond mutual fund. This was the first of many
opportunities I've enjoyed for free lunches
It’s hard to prove efficiency or inefficiency.
Among other reasons, the academics say it takes many
decades of data to reach a conclusion
with “statistical significance"
but by the time the requisite number
of years have
passed, the environment is likely to have been altered. Regardless, I think we must look at
the changes listed above and accept that the conditions of today are less propitious for inefficiency than
those of the past.
In short, it makes sense to accept that most games are no longer as easy as they
used to be, and that as a result free lunches are scarcer. Thus, in general, I think it will be harder
to earn superior risk-adjusted returns in the future, and the margin of superiority will be smaller.
I believe many markets are quite efficient.
Everyone is aware of them, basically understands them, and
is willing to invest in them. And in general everyone gets the same information at the same time (in fact,
it’s one of the SEC’s missions to
make sure that’s the case).
I had markets like that in mind in 1978
when, on going into portfolio management, my rule was,
“I’ll do anything but spend the rest of my life
choosing between Merck and Lilly.”
http://www.oaktreecapital.com/MemoTree/Getting Lucky_2014_01_16.pdf 
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