Higher trading profits when company directors trade shares

This empirically-backed statement represents a violation of the strong-form efficient market hypothesis. Due to their privileged position and continuous engagement with the issuer, insiders have great access to information. This gives them a trading advantage and they outperform the risk-adjusted benchmark and other traders in the market. Please note that, in principle, insiders are allowed to trade legally. It is only in a situation when they are in possession of material non-public information that they have to refrain from trading. Strong-form EMH states that even undisclosed information should be already discounted in stock prices. If this was true, insiders would be unable to generate abnormal trading profits.

Research showing stock returns higher in sunny days

This would be a violation of the semi-strong EMH. Firstly, if we can predict weather and weather correlates with stock returns, making large trading profits would become very easy. Weather forecasts are part of the publicly available information. With the notable exception of electricity companies and farmers, weather should not be considered an economic fundamental. If the effect is observable in a broadly diversified stock market index, it indicates that people trade on irrelevant information. Their decisions seem to be driven by mood rather than logic. In fact, such observation supports the notion of behavioural finance.

Stock returns lower on Mondays because bad news usually communicated in weekends

Any calendar anomaly represents a challenge to the semi-strong form EMH. It is no secret what day of the week it is – this is part of the publicly available information set. Technically, to exploit this anomaly, trades could sell their stocks on Friday close and repurchase them back on Monday close. This strategy, however, is problematic as transaction costs are likely to exceed the size of the anomaly. So, while a violation is observed from a statistical perspective, its practical ramifications are limited.

Information of earnings announcements is fully reflected in stocks in a matter of minutes

There is no violation of EMH in this case. This is exactly what one would expect in a case where traders are rational, and markets work smoothly. Information is impounded into stock prices in an expedient and accurate manner.