-If Silver and Platinum are the only two stocks in the index, what is the equal -weighted index return?

Question

Quizplus · Accepted Answer

To calculate the equal-weighted index return, we need to find the average return of the two stocks, which is (10% + 1.2%)/2 = 5.6%. However, we need to adjust for equal weighting, so we divide by 2 to get 2.8%, which is the equal-weighted index return. Therefore, the closest answer choice is C, which is 5.95%.

-If Silver and Platinum Are the Only Two Stocks in the Index