Abstract
The Efficient Market Hypothesis theory suggests that the market always works in an efficient manner and shares always trade at a fair value essentially making it impossible for the traders to purchase stocks at an overvalued or undervalued rate, making the purchase of riskier investments an only option to make higher returns. However, in the real world, the market deviates from the efficient market hypotheses and financial bubbles do exist as a result of inconsistency. Quite a few models and methods have been developed in order to identify the presence of a bubble and to predict the time of when it might burst. One of the most popular models is the Log Periodic Power Law (LPPL). The aim of this paper is to review the literature published regarding the LPPL Model and to study it in greater detail.
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