For a given security, which EMH form believes that insider information will yield an advantage?

The strong form of the Efficient Market Hypothesis (EMH) posits that all information, both public and private (including insider information), is fully reflected in the stock prices. This means that no investor can achieve superior returns consistently, as any available information is already incorporated into the market prices. Therefore, insider information would not yield any competitive advantage to investors, as the market is deemed to be fully efficient at all levels of information.

In contrast, the weak form asserts that past price movements and volume data are already reflected in stock prices, suggesting that technical analysis cannot provide an advantage. The semi-strong form states that all publicly available information is accounted for in stock prices, allowing for fundamental analysis to be ineffective for generating excess returns. Hence, only the strong form acknowledges the existence of insider information and its impact on a security’s price.