《《4_14Investment Performance of Common Stocks in Relation to Their Price-Earnings》.pdf

Investment Performance of Common Stocks in Relation to Their Price-Earnings Ratios: A Test of the Efficient Market Hypothesis S. Basu The Journal of Finance, Vol. 32, No. 3. (Jun., 1977), pp. 663-682. Stable URL: /sici?sici=0022-10822932%3A3%3C663%3AIPOCSI%3E2.0.CO%3B2-C The Journal of Finance is currently published by American Finance Association. Your use of the JSTOR archive indicates your acceptance of JSTORs Terms and Conditions of Use, available at /about/terms.html. JSTORs Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at /journals/afina.html. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is an independent not-for-profit organization dedicated to and preserving a digital archive of scholarly journals. For more information regarding JSTOR, please contact support@. Sun Apr 8 06:33:30 2007 THE JOURNAL O F FINANCE . VOL. XXXII, NO. 3 . J U N E 1977 INVESTMENT PERFORMANCE OF COMMON STOCKS IN RELATION TO THEIR PRICE-EARNINGS RATIOS: A TEST OF THE EFFICIENT MARKET HYPOTHESIS IN AN EFFICIENT CAPITAL MARKET,security prices fully reflect available information in a rapid and unbiased fashion and thus provide unbiased estimates of the underlying values. Wh