I see where you're going with the grocery store produce analogy, but it's not a useful analogy for how markets work.
1. Those grocery store items (let's say tomatoes) are priced equally to each other, by decision of the supermarket. This is not true of securities, which are individually traded and priced separately, which allow differences to be priced in.
2. The market for tomatoes at your local grocery store is geographically constrained, limiting the number of participants. This is not true of publicly traded stocks that nearly anyone in the world can trade.
3. The amount of money that can be put to use finding efficiencies at your local market is small. In global markets, the payoff is in the billions, and so many people are scouring for similar efficiencies - and in the process, eliminating them.
4. The tomato market has high transaction costs. What are you going to do when you find a better tomato for the same price? Sell it to someone else for a higher price? No. The arbitrage opportunity for tomatoes doesn't exist.
Efficient markets is not a thesis that is required to be true of all markets by some sort of law. They are a consequence of liquid markets that are large and traded by many well-funded participants. The analogy must have the same factors to be valid.
1. Those grocery store items (let's say tomatoes) are priced equally to each other, by decision of the supermarket. This is not true of securities, which are individually traded and priced separately, which allow differences to be priced in.
2. The market for tomatoes at your local grocery store is geographically constrained, limiting the number of participants. This is not true of publicly traded stocks that nearly anyone in the world can trade.
3. The amount of money that can be put to use finding efficiencies at your local market is small. In global markets, the payoff is in the billions, and so many people are scouring for similar efficiencies - and in the process, eliminating them.
4. The tomato market has high transaction costs. What are you going to do when you find a better tomato for the same price? Sell it to someone else for a higher price? No. The arbitrage opportunity for tomatoes doesn't exist.
Efficient markets is not a thesis that is required to be true of all markets by some sort of law. They are a consequence of liquid markets that are large and traded by many well-funded participants. The analogy must have the same factors to be valid.