The major concern that has been raised with respect to the weighting of countries within the EAFE index is
A)currency volatilities are not considered in the weighting.
B)cross-correlations are not considered in the weighting.
C)inflation is not represented in the weighting.
D)the weights are not proportional to the asset bases of the respective countries.
E)None of the options

Question

Quizplus · Accepted Answer

Some argue that countries should be weighted in proportion to their GDP to properly adjust for the true size of their corporate sectors, since many firms are not publicly traded.

The Major Concern That Has Been Raised with Respect to the Weighting