An efficient market is defined as one where stock prices always reflect all available information.
In reality, perfect efficiency is an abstraction. Markets are influenced by emotions, irrationality, and information asymmetries, and this in my view is particularly evident in small caps, which are less followed by analysts and institutional investors. This creates inefficienciesbecause information circulates less quickly and prices may not reflect the real value of the company.
The Italian market accentuates this because it is typically a local market," with fewer international investors, and that brings with it obvious problems of transparency and communication of companies.
In my opinion, one can find very discounted companies whose price does not reflect the real value of the company at all.
Do you have any small caps in your portfolio with excellent fundamentals ?
