Behavioral finance challenged paradigms of standard finance by questioning rationality
assumptions posed by market efficiency that had been a focal point for researches in finance
and economics. This study aimed to test Strong-Form Efficient Market Hypothesis by employing data from
emerging Stock Markets of Pakistan before its amalgamation and applied a different methodology. Firms were
tested upon data availability and accordingly, ten firms were selected out of sixteen further for usability criteria
of data. A part of the current study also validates the usefulness of dividend announcements for valuing the stock
of KSE listed firms and suggested utilizing it in stock price revision. The market was found weak and strong
form inefficient whereas the hypothesis for semi-strong form sustained overall
Associate Professor, Department of Business Studies, Bahria University, Islamabad, Pakistan.
Kanwal Iqbal Khan
Assitant Professor, Institute Of Business & Management, University of Engineering & Technology, Lahore, Pakistan.
Assistant Professor, Department of Economics, Islamia College University, Peshawar, Pakistan.
Capital Market Efficiency, Strong form Efficiency, Emerging Markets, Dividend Announcements, Insider Trading.