7 Event Study
Event studies are popular in finance research. The method is old and yet quite robust even today. The core assumption underlying an event study is that the stock markets are “informationally efficient”. Current stock prices reflect all the publicly available information and the stock prices adjust quickly to the release of all new public information that is value relevant.41 If you want to know more about market efficiency, I suggest reading this article: https://www.investopedia.com/terms/s/semistrongform.asp
This is known as semi-strong form of market efficiency.↩