25 Shailesh Gandhi, Hemantkumar P. Bulsara, Pooja Patel ¹²³S.V. National Institute of Technology Applied Mathematics & Humanities Department, Surat -395007 Conceptual Study on Efficient Market Hypothesis for the World Markets: Finding Opportunities for Indian Stock Markets UDC: 336.76 ; 005.336.1:336.717.71(540) DOI: 10.7595/management.fon.2013.0009 1. Introduction In the year 1991, India instigated the wave of financial liberalization with deregulation of interest rates and market-based allocation of resources, which have pervaded competition in the financial markets. In the light of these developments, it is expected that financial markets in India have achieved some degree of maturity and integration. Numerous researchers have concluded from their research, that globalization has made dif- ferent financial markets of the world more integrated. The fact of financial market being integrated does not hold true if efficiency does not exist in these markets. This is also coupled with another actuality that a fi- nancial market that is well developed is considered to be an efficient one and thus is well integrated with the other financial market with similar characteristics. A distinctive trait of any stock market is its price behaviour. Price behaviour means the direction in which the share prices tend to move and this movement of share prices evolved the concept of the Efficient Market Theory. This is principally concerned by investigating the share price behaviour and whether the these are envisaged in future by any perfunctory means; if so, than any class of investors are able to earn unswerving and extensive success in investment matters. Michael Firt has indentified that majority of researchers involved in these studies have been (a) academics, who were interested in determining the efficiency of stock markets in socio-economic terms and (b) prac- ticing investors and investment advisory firms, who sought to derive profitable investment strategies. The ef- ficient market hypothesis states that asset prices in financial markets should reflect all the available Management Journal for Theory and Practice Management 2013/67 It is an established fact that efficient and developed financial markets can lead to increased economic growth by improving the efficiency of allocation and utilization of savings in the economy. But the primary requirement of the capital market is allocation of ownership of the economy’s capital stock. Also the ideal situation of the market ex- ists when the prices of different securities provide accurate signals for the investment decisions to the investors, who can choose such securities that represent ownership of firms’ activities under the assumption that security prices at any time fully reflect all available information. All this can be very well studied by understanding the share price behavior of the stock in any market and whether the same are envisaged in future by any perfunctory means; if so, any class of investors are able to earn unswerving and extensive success in investment matters. This conceptual paper attempts to accumulate the theoretical evidence of Stock market efficiency across the globe and exemplify its possibility for the Indian markets. The world markets including Indian stock markets reveal a mixed form of results and therefore it can be concluded that the market efficiency study from the In- dian markets front is very primordial in nature and lacks the modern existence of research. Keywords: Financial Markets, Market Efficiency, Weak-form of market efficiency 1 Associate Professor, IIM, Ahmedabad; (M) 98250-74864; E-mail: shailesh@iimahd.ernet.in 2 Assistant Professor, SVNIT, Surat; (M) 98255-35673; E-mail: hemantbulsara@gmail.com 3 Assistant Professor, SRLIM, Surat; & Pursuing PhD from SVNIT, Surat; (M) 98259-64587; E-mail: pooja_patel1313@rediffmail.com