Business and Personal Finance Dictionary

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• INEFFICIENT MARKET
  
  When a market is described as inefficient, it means that investors do not know enough about the securities in that market to make informed decisions about what to buy or the price to pay. Markets in emerging nations may be inefficient, since few analysts follow the securities being traded there. Similarly, there can be inefficient markets for stocks in new companies, particularly those in new industries. An inefficient market is the opposite of an efficient one, where it's assumed that investors know everything there is to know about the securities they are buying.
  
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