William likes to invest in smaller U.S. companies because of their high potential for growth and large longterm returns. Which stock index should he follow?

Question

William likes to invest in smaller U.S. companies because of their high potential for growth and large long­term returns. Which stock index should he follow?

Quizplus · Accepted Answer

The Russell 2000 is a stock index that tracks the performance of 2,000 small-cap U.S. companies, making it a suitable choice for William's investment strategy. The Dow and the S&P 500 index track larger, more established companies, while the Nikkei 225 tracks the performance of Japanese companies, making them less relevant for William's investment goals.

William Likes to Invest in Smaller U