- CFA Exams
- CFA Level I Exam
- Study Session 12. Equity Investments (1)
- Reading 37. Security Market Indices
- Subject 4. Different Types of Security Market Indices
CFA Practice Question
A GDP-weighted multi-market index is essentially a ______ index.
A. price-weighted
B. market-capitalization-weighted
C. fundamentally weighted
Explanation: Such an index weights each country in the overall index in proportion to its relative GDP.
User Contributed Comments 2
| User | Comment |
|---|---|
| tomalot | GDP is the size of the economy i.e. the market cap? |
| CJPerugini | @tomalot - I was under the same impression at first. The main difference is GDP is a periodic measure, meaning it is more like the value added to its existing market cap. |