1. C
1.1. c1
1.1.1. c1.1
1.2. c2
1.2.1. c2.1
2. D
3. E
3.1. e1
3.2. e2
3.2.1. e2.1
3.2.1.1. e2.1.1
4. SECURITY MARKET INDICIES
4.1. Describe a security market index
4.1.1. use
4.1.1.1. to represent the performance of an assert class, security market, or segment of a market
4.1.2. creation
4.1.2.1. portfolio of individual securities
4.1.2.1.1. constituent securities of the index
4.1.3. index return
4.1.3.1. % change in the index value over a period
4.2. CONCEPT & CALCULATE
4.2.1. Concept
4.2.1.1. Price index
4.2.1.1.1. reflect only the prices of the consituent securities within the index
4.2.1.1.2. price return of an index
4.2.1.2. Total return index
4.2.1.2.1. reflects both prices and income from the consituent securities
4.2.1.2.2. total return of an index
4.2.2. Calculate
4.2.2.1. for single-period
4.2.2.1.1. PR = (V1-V0)/V0
4.2.2.1.2. TR=(V1-V0+INCOME)/V0
4.2.2.2. for multiple period
4.2.2.2.1. Ri = (1+R1)(1+R2)(1+R3)...(1+Rn)-1
4.3. INDEX CONSTRUCTION & MANAGEMENT
4.3.1. Which target market
4.3.2. Which securities
4.3.3. Weighting
4.3.4. Rebalancing frequency
4.3.5. Re-exmining selection & weighting
4.4. WEIGHTING METHOD
4.4.1. Price weighted index
4.4.1.1. Calculation
4.4.1.1.1. arimetic mean average
4.4.1.2. Matching portfolio
4.4.1.2.1. portfolio with equal number of shares in each stock
4.4.1.3. advantage
4.4.1.3.1. simple computation
4.4.1.4. disadvantage
4.4.1.4.1. a percentage change in a high-priced stock will have a relatively greater effect on the index
4.4.1.5. 2 major indices
4.4.1.5.1. DJIA
4.4.1.5.2. Nikkei Dow Jones Stock Average
4.4.2. Equal weighted index
4.4.2.1. calculation
4.4.2.1.1. arithmetic average return of index stocks
4.4.2.2. matching portfolio
4.4.2.2.1. equivalent to a portfolio that has equal dollar amounts invested in each stock in the index
4.4.2.3. adv
4.4.2.3.1. simple computation
4.4.2.4. disadv
4.4.2.4.1. matching portfolio has to be adjusted periodically
4.4.2.4.2. weight on returns of small-cap stocks
4.4.2.5. example
4.4.2.5.1. the value line (VL) composite average
4.4.2.5.2. Financial Times ordinary share index
4.4.3. Market-cap weighted index (or value weighted index)
4.4.3.1. matching portfolio
4.4.3.1.1. %value of each security in the portfolio = % in the index
4.4.3.2. alternative
4.4.3.2.1. market float
4.4.3.2.2. free float
4.4.3.2.3. float-adjusted market cap-weighted index
4.4.4. Fundamental weighting (earnings, dividends, cashflow)
4.4.4.1. use weight based on firm fundamentals
4.4.4.1.1. such as earnings, CF, dividends,..
4.4.4.2. ADV: avoid the bias of value weighted index
4.5. METHOD
4.5.1. Rebalancing
4.5.1.1. adjusting the weights of securities in a portfolio to their target weights after price changes have affected the weights
4.5.2. index recontruction
4.5.2.1. periodically adding and deleting securities that make up an index
4.6. TYPES OF FIXED INCOME INDICIES
4.6.1. Characteristics
4.6.1.1. Large universe of securities
4.6.1.2. Dealer markets and infrequent trading
4.6.2. Sectors, geographic regions, levels of country economic development, type of issuers or collateral, coupon, maturity, default risk, inflation protection
4.6.3. Broad market indexed, sector,..
4.7. INDEXED REPRESENTING ALTERNATIVE INVESTMENTS
4.7.1. Commodity indexes
4.7.1.1. use: represent futures contracts on commodities
4.7.1.2. weighting method
4.7.1.2.1. equal weight
4.7.1.2.2. commodities by their global production value
4.7.1.2.3. fixed weights
4.7.2. Real estate indexes
4.7.2.1. using returns based on
4.7.2.1.1. appraisal of properties
4.7.2.1.2. repeat property sales
4.7.2.1.3. performance of REITS
4.7.3. Hedge Fund Indexes
4.7.3.1. equally weight returns of hedge funds in the index
4.7.3.2. upward bias
5. MARKET EFFICIENCY
5.1. B1
5.1.1. B1.1
5.1.2. B1.2
5.1.3. B1.3
5.1.4. B1.4
5.2. B2
5.2.1. B2.1
5.2.1.1. B2.2
5.2.2. B2.2
5.2.3. B2.3
5.3. B3
6. 🎇🧨✨🎉🎊🎃🧧🎑🎐🎏🎎🎍🎋🎄🎀🎁🎗🎞🎟
6.1. F1
6.1.1. F 1.1
6.1.2. F 1.2
6.1.3. F 1.3