Session 13: Market Organization, Market Indices, and Market Efficiency
Reading 56: Security Market Indices
LOS f: Discuss rebalancing and reconstitution.
Reconstitution of an index refers to:
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A) |
adjusting the weights of the securities that constitute the index. | |
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B) |
changing the methodology used to calculate the value of the index. | |
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C) |
removing some securities from the index and adding others. | |
Reconstitution begins with evaluating the securities in an index against the index’s criteria. Securities that are no longer representative of the index are removed and replaced with different securities that do meet the criteria. Adjusting the weights of the securities that constitute an index is termed rebalancing. | 
发表于 2011-3-29 16:25
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