Using the S&P 500 Portfolio as a Proxy of the Market

question 8

Multiple Choice

Using the S&P 500 portfolio as a proxy of the market portfolio

• A) is appropriate because U.S. securities represent more than 60% of world equities.
• B) is appropriate because most U.S. investors are primarily interested in U.S. securities.
• C) is appropriate because most U.S. and non-U.S. investors are primarily interested in U.S. securities.
• D) is inappropriate because U.S. securities make up less than 41% of world equities.
• E) is inappropriate because the average U.S. investor has less than 20% of his or her portfolio in non-U.S. equities.

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Definitions:

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