FYI: Noise traders – individuals that distort the market by trading on incomplete or inaccurate information – have been discussed by academics and investors alike for decades. No one could ever deny the existence of noise traders, but proponents of the efficient market hypothesis (EMH) have long contended that these traders have little-to-no impact on the overall market.
The past 20 years – which includes the tech bubble, housing bubble, and dozens of boom and bust “story stocks” – make it clear that noise traders have much more influence than EMH doctrinaires admit. That influence is only growing, as the rise of self-directed traders and the relentless noise of the financial press mean the noise to signal ratio is worse than ever. Wild swings in stocks such as Tilray (TLRY) show just how inefficient markets can be.
Regards,
Ted
https://www.forbes.com/sites/greatspeculations/2018/10/09/danger-zone-rise-of-the-noise-traders/#65fbd8f774a4
