Question
Now assume that you have 50 shares of AAPL and 20 shares of FB (i.e., the ratio between AAPL and FB market values is 5:2).
Now assume that you have 50 shares of AAPL and 20 shares of FB (i.e., the ratio between AAPL and FB market values is 5:2).
Calculate the Price-weighted Index (Index Value and Index Return) and Market Value-weighted Index (Index Value and Index Return).
Can you also write the steps and example of a few on how to calculate it so I understand the process? Thank you.
AAPL | FB | Price-weighted Index | Market Value-weighted Index | |||||||||
Date | Adj Close | Return | Date | Adj Close | Return | Index Value | Index return | Index Value | Index return | |||
1/1/2015 | 106.9111 | 1/1/2015 | 75.91 | |||||||||
2/1/2015 | 117.2226 | 0.0964492 | 2/1/2015 | 78.97 | 0.040311 | |||||||
3/1/2015 | 113.9932 | -0.027549 | 3/1/2015 | 82.22 | 0.041155 | |||||||
4/1/2015 | 114.6528 | 0.0057865 | 4/1/2015 | 78.77 | -0.04196 | |||||||
5/1/2015 | 119.3526 | 0.0409908 | 5/1/2015 | 79.19 | 0.005332 | |||||||
6/1/2015 | 115.3893 | -0.033206 | 6/1/2015 | 85.77 | 0.083091 | |||||||
7/1/2015 | 111.5899 | -0.032927 | 7/1/2015 | 94.01 | 0.096071 | |||||||
8/1/2015 | 103.8808 | -0.069085 | 8/1/2015 | 89.73 | -0.04553 | |||||||
9/1/2015 | 101.9298 | -0.018781 | 9/1/2015 | 89.9 | 0.001895 | |||||||
10/1/2015 | 110.4316 | 0.0834089 | 10/1/2015 | 101.97 | 0.13426 | |||||||
11/1/2015 | 109.3227 | -0.010042 | 11/1/2015 | 104.24 | 0.022261 | |||||||
12/1/2015 | 97.68863 | -0.10642 | 12/1/2015 | 104.66 | 0.004029 |
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