Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. finance
  3. an analyst wants to estimate the historical equity

An analyst wants to estimate the historical equity market return of the developed Europe market....

90.2K

Verified Solution

Question

Finance

image
An analyst wants to estimate the historical equity market return of the developed Europe market. He downloaded the portfolio holdings of a European market ETF at the end of 2019 and use the weighted average historical returns of those stocks to estimate the market return over a 20-year period (while the ETF only goes back for 10 years). The potential issues of this exercise include: a. A survivorship blas as those companies in the ETF in 2019 would be the ones that have historically performed well b. All of the options c. A look-ahead bias as we would have not known the stocks that are large enough to be included in the ETF before 2019 d. A look-ahead bias as the weight used in the calculation is determined at the end of 2019 and would not have been known to investors historically

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Advance Math
1.2K views

Use euler method to approiximate y(1) y' is given , solve for y. approiximate y(1) Create a...

Physics
1.2K views

Thermodynamics What is the difference between internal energy and enthalpy? a. Give a definition for each quantity b. Give...

Advance Math
1.2K views

A set X is said to be closed under multiplication if for every x1,x2 ? X...

Basic Math
1.2K views

A basketball player has made 12 of his last 20 free throws, which is a...

Basic Math
1.2K views

Which one of the following options is true when considering the expansion ofthe binomial expression...

Basic Math
1.2K views

Two variables appear to have an exponential relationship. What pattern(s) does the scatterplotsuggest for the...

Algebra
1.2K views

Graph the system below and write its solution 2x y 2 y x Note that...

Accounting
1.2K views

Held-to-maturity securities are reported at their: fair value. net realizable value. historical...

Accounting
1.2K views

Georgio Company began 2014 with net assets of $80,000. Net income calculated by using the...

Accounting
1.2K views

One of the capital decisions categories is called screening decisions: O a. Which relates to...

Accounting
1.2K views

On January 1, Year 2 Grande Company had a $9,000 balance in the Accounts Receivable...

Accounting
1.2K views

President Franklin Roosevelt's 100% Tax Plan Vividly describe the Roosevelt 100% Tax Plan. Use direct...