From www.investorhome.com: "An issue that is the subject of intense debate among academics and financial professionals is the Efficient Market Hypothesis (EMH). The Efficient Market Hypothesis states that at any given time, security prices fully reflect all available information. The implications of the efficient market hypothesis are truly profound. Most individuals that buy and sell securities (stocks in particular), do so under the assumption that the securities they are buying are worth more than the price that they are paying, while securities that they are selling are worth less than the selling price. But if markets are efficient and current prices fully reflect all information, then buying and selling securities in an attempt to outperform the market will effectively be a game of chance rather than skill." This got me thinking a little bit. Not a bad thing.... When we look at the current price of a share, who believes in the Efficient Market Hypothesis or at least some variation of it? I guess some would say that, for example, if the current price of BHP is $20.00 then by and large that's probably it's 'true value' based on all the valuation estimates carried out by the various large institutions from the best available information and they would respond fairly quickly. Alternatively, others would say that this price may exclude some 'human sentiments' such as fear and greed which may also have a big impact on current price. For example, the EMH price may be one thing but then add to that a bit of 'fear and greed' and we'll get the plus and minus variations around the EMH value over time. So what is the 'true value' of a share? (yes......yes......it's what someone is willing to pay for it but I'm looking at this from a slightly different angle). If we assume that human sentiment may distort the 'true value' regularly in the short term, would it be likely that maybe the long term average of the EMH value would actually give us a pretty good estimate of a share's true value? If so, over what period may be another good question. Any thoughts?