ANZ Asia equity index is a new entry into Asian market indices. The index has better coverage especially in the South Asian markets as compared to its more popular rivals. The index has coverage of 90 percent of all stocks listed in the constituent markets. Which of the following statements best describes the index? A) | Breadth is high, liquidity is high, and crossing opportunities are low. |
| B) | Breadth is high, liquidity is low, and crossing opportunities are low. |
| C) | Breadth is low, liquidity is high, and crossing opportunities are low. |
| D) | Breadth is high, liquidity is low, and crossing opportunities are high. |
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Answer and Explanation
Since the index is fairly comprehensive (90 percent coverage), breadth of the index is high. However due to the high breadth and being fairly new in the market, the index is not very liquid. Also lower popularity (new index) translates into lower crossing opportunities. |