CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

Security market indices are used ______

I. as benchmarks for portfolio performance.
II. to construct index funds.
III. as inputs for technical analysis.
IV. to determine systematic risk.
Correct Answer: I, II, III and IV

User Contributed Comments 2

User Comment
Shaan23 In the text a question states. Uses of Market indices do NOT include serving as:
Answer - measure of systematic risk.

Tricky - So its not a measure of systematic risk but is used to determine systematic risk.

Solution goes on as Security markets indices are used as a proxy for measuring systematic risk but is NOT a measure of systematic risk
birdperson @shaan23 -- to get your beta you run a regression with an index and a security & beta is measure of systematic risk
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