CFA Practice Question
In each of the following possible answers, the index is listed first, then the weighting method, then the source of the stocks that comprise the index. Which of the following lists is (are) correct?
II. S&P 500; market value weighted; NYSE & OTC
III. NYSE Composite; market value weighted; NYSE
IV. DJIA; price-weighted; NYSE & OTC.
I. Value Line Composite; equal weighted; NYSE, AMEX, & OTC.
II. S&P 500; market value weighted; NYSE & OTC
III. NYSE Composite; market value weighted; NYSE
IV. DJIA; price-weighted; NYSE & OTC.
A. I, II and III.
B. II, III and IV.
C. I, II, III and IV.
Explanation: Table 5.5 on page 158 of the text lists many more sequences such as these. Each of these answers is an accurate compilation of index, weighting, and source of stocks in the index.
User Contributed Comments 4
| User | Comment |
|---|---|
| robkaz | Just to clarify IV: DJIA now includes Intel and Microsoft, 2 NASDAQ stocks. |
| nufan | NASDAQ is OTC |
| volkovv | OTC is the market in similar sense as NYSE or AMEX; NASDAQ is an automated, electronic quotation system for the vast OTC market watch out this can be grounds for a tricky question |
| harrybay | Yeah I got caught. I think the Dow didn't include any OTC stock. |