Random walk theory and its applicability to financial markets The random walk theorem, first presented by French mathematician Louis Bachelier in 1900 and then expanded upon by economist Burton ...

Random walk theory was popularized by economist Burton Malkiel in his 1973 book, A Random Walk Down Wall Street. Malkiel’s theory aligns with the semi-strong efficient hypothesis which also ...

Random walk theory maintains that the movements of stocks are utterly unpredictable, lacking any pattern that can be exploited by an investor. This is in direct opposition to technical analysis ...

Thus, price direction is chaotic, but not random. The case for the random walk argument is that trends can appear in patterns that are actually random. Think of a coin toss.