I think an efficient market is for intro to economics what a frictionless vacuum is for intro to physics - a way of accessing some fundamental truths, rather th

I think an efficient market is for intro to economics what a frictionless vacuum is for intro to physics - a way of accessing some fundamental truths, rather than a description of something frequently encountered in the world. The existence of the hedge fund industry is a paradox for the idea of efficient markets. If markets are efficient, then the value added of hedge funds is zero. And if markets are efficient, hedge funds should only be able to charge their value added in fees, which is zero. Hedge funds charge a lot of fees. PE and VC funds charge even more. So markets are not efficient.