Random walk theory proposes that stock prices move unpredictably, making it impossible to predict future movements based solely on past trends. This financial theory, first popularized by economist ...

The random walk theorem, first presented by French mathematician Louis Bachelier in 1900 and then expanded upon by economist Burton Malkiel in his 1973 book A Random Walk Down Wall Street, asserts ...

Random walk hypothesis suggests stock market movements are unpredictable, impacting active trading. This theory supports long-term investment strategies, like buy-and-hold, over short-term speculation ...

Two versions of the random walk hypothesis are identified: the price version in which future prices are hypothesized to be independent of past price movements; and the history version in which future ...

The forward premium, the difference between the forward exchange rate and the spot exchange rate, contains economically valuable information about the future of exchange rates. Here is the evidence ...

We derive a perturbation expansion for general self-interacting random walks, where steps are made on the basis of the history of the path. Examples of models where this expansion applies are ...