Compare the following two stocks during the Covid.
- American Airlines Group Inc
- Air China Ord Shs A
Using random walk theory (and other theories) to prove that the public information of Covid-virus is weak form（one of the Efficient Markets Hypothesis）for the volatility of these two stocks.
Please use the following viewpoints to support the above argument:
-Degree of impact in different markets (same industry in different countries)
-Using mathematical models to prove that the impact of the coronavirus on the market makes the market weak and effective. (Or make the market’s stock price inaccurate with the market price)
-Why does the (public information) valuation of the financial reports of these two companies can’t support the true price of the market stocks. -Explain the authenticity of financial statements of two companies (falsified financial reports)
-Because China Airlines is a state-owned company, but American Airlines is a private company. In addition, China is a socialist country, but the United States is a capitalist country. Will this affect the idea that Covid-virus is the weak form (one of the Efficient Markets Hypothesis) for the volatility of these two stocks?
Sample Solution
