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[求助] CFA L1 Equity 问题请教

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楼主
发表于 2008-6-2 05:49:00 | 只看该作者

[求助] CFA L1 Equity 问题请教

Schweser June 08 Exam 1 Morning

86. M. Gomez has purchased 100 shares of each of the stocks in the Dow Jones Industrial Average, a price-weighted index, and intends to reinvest cash dividends in additional shares. Assuming there are no stock splits, stock dividends, or changes in the make-up of the index, how will Gomez's portfolio return based on its initial value compare to that of the DJIA? His portfolio:

A. will have higher returns than the DJIA.

B. will return less than the DJIA because of commissions on reinvested dividends.

C. performance relative to the DJIA will depend on how low-price stocks perform relative to high-price stocks.

D. may do better or worse than the DJIA depending on whether the overall market goes up or down.

Why is the answer A?

I understand that DJIA has downside bias due to stock split, but there are no stock splits here.

Also does it mean that Gomez bought the 30 stocks that consititute the index?

沙发
发表于 2008-6-2 09:51:00 | 只看该作者
because he intends to reinvest cash dividends back to additional share, DJIA does not count the reinvest cash dividends, so his return is higher the DJIA
板凳
发表于 2008-6-4 04:38:00 | 只看该作者
Dividend reinvested
地板
 楼主| 发表于 2008-6-4 07:10:00 | 只看该作者
Thank you, yankee_sailor and Emily 915!
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