random walk

random walk
The theory that the *market prices of *common stock (and other items, like *commodities) exhibit unpredictable patterns, and do not reflect historical trends. The theory argues that stock prices behave unpredictably because stock markets are inefficient. The market value of a security or commodity is independent of its *historical prices, and any new data affecting its value is immediately reflected in its price.

Auditor's dictionary. 2014.

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