Which of the following statements is FALSE? O a. Because very little trading is required to maintain it, an equal-weighted portfolio is called a passive portfolio. O b. The CAPM says that individual investors should hold the market portfolio, a value-weighted portfolio of all risky securities in the market. O c. A price-weighted portfolio holds an equal number of shares of each stock, independent of their size. O d. If the number of shares in a value-weighted portfolio does not change, but only the prices change, the portfolio will remain value-weighted.
Which of the following statements is FALSE? O a. Because very little trading is required to maintain it, an equal-weighted portfolio is called a passive portfolio. O b. The CAPM says that individual investors should hold the market portfolio, a value-weighted portfolio of all risky securities in the market. O c. A price-weighted portfolio holds an equal number of shares of each stock, independent of their size. O d. If the number of shares in a value-weighted portfolio does not change, but only the prices change, the portfolio will remain value-weighted.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
May I know the answer ?
Transcribed Image Text:Which of the following statements is FALSE?
O a. Because very little trading is required to maintain it, an equal-weighted portfolio is called a passive portfolio.
O b. The CAPM says that individual investors should hold the market portfolio, a value-weighted portfolio of all risky securities in the market.
O c. A price-weighted portfolio holds an equal number of shares of each stock, independent of their size.
O d. If the number of shares in a value-weighted portfolio does not change, but only the prices change, the portfolio will remain value-weighted.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education