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Q5d) Suppose you want to select a value-weighted index as a proxy for the market portfolio. Based on your knowledge of Modern Portfolio Theory, which
Q5d) Suppose you want to select a value-weighted index as a proxy for the market portfolio. Based on your knowledge of Modern Portfolio Theory, which of the following indexes is likely to be the best (3 points) a. The Dow Jones Industrial Average b. The Standard & Poor's 500 c. Wilshire 5000, which is a market-capitalization-weighted index of all stocks actively traded in the USA d. The Russell 2000 Index, which is a small-cap stock market index of the bottom 2,000 stocks in the Russell 3000 Index (Russell 3000 index has 3,000 largest publicly held companies incorporated in America as measured by total market capitalization) e. Cannot tell
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