Darien

gregorynep Wrote:
-------------------------------------------------------
> How come in the answer they use the ending market
> period to calculate return?
>
> To me, the correct method is to do a weighted
> average of the stock price changes using the
> Market Cap at 1/1/09 as weight.
>
> The problem says no stock splits or dividends, so
> the only reason for a difference between the price
> change and the market cap change is an acquisition
> or a spinoff, neither of which would cause a value
> weighted index to apprecaite.
>
> I got equally weighted as very narrowly beating
> out price weighted.
>
> thanks for any help in advance.

This example is directly out of the book...the book would be better than anyone else telling you how to do it.

ll11

Where is the example in the book? Do you mean Reading 32, page 208? the example here has market value changing by the price change.