CFA Practice Question

CFA Practice Question

In calculating the Standard & Poor's stock price indices, the adjustment for stock splits occurs ______
A. by adjusting the numerator.
B. automatically, due to the manner in which the index is calculated.
C. by adjusting the divisor.
Explanation: There is an automatic adjustment for stock splits because the decrease in the stock price is offset by an increase in the number of shares outstanding.

User Contributed Comments 3

User Comment
danlan S&P is market value based
chuong because S&P is value weighted index
jackwez by market cap....
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