The S&P 500 index traditionally is a ________ portfolio of the 500 largest U.S.stocks.
A)value weighted
B)equally weighted
C)chain weighted
D)price weighted
E)reputation weighted

Question

Quizplus · Accepted Answer

The S&P 500 index is traditionally a value-weighted portfolio of the 500 largest U.S. stocks. This means that the weight of each stock in the index is determined by its market capitalization, or the total value of all outstanding shares of the company. This method gives more weight to companies with larger market caps, and therefore a larger impact on the overall index.

The S&P 500 Index Traditionally Is a ________ Portfolio of the 500