SEC investigating KODAK for possible violation of FD Act

Bloomberg: Warren seeks SEC insider trading probe

BI: The SEC is investigating KODAK

this is crazy. the stock went from barely over $2 to slightly above $33 in just 2 days.
As of now, Kodak is $14.40 / share.

Someone correct me if I’m wrong, but this unusual increase in Kodak’s share price seems to be a violation of the strong version of Efficient Market Hypothesis, since investors were able to profit from private information. This also seems to be in violation of CAPM, since one of the assumptions of CAPM is that investors have homogeneous expectations regarding the stock’s expected return. Investors who acquired private information had a different expectation compared to individual investors at large.

Insider information contradicts efficient markets? That’s definitely not the case. This is efficient markers 101

Yeah, CAPM is my guiding light and north star for all my investment decisions. So is the YOLO model.

I think the OP meant the strong version. I think in the strong version, even insider information is incorporated in the price. But I don’t think anyone has ever even argued that we’re living in a strong EMH world.

It’s gonna be pretty easy to find out who was trading before the news. The stock averaged daily trading volume of 70k and shot up to 1.6 million on the day prior to the news.