单选题

Which of the following statements is most accurate with respect to rebalancing and reconstitution of security market indices?

A、 Equal weighted indices require frequent rebalancing.
B、 Turnover within an index results from a reconstitution but not from rebalancing.
C、 A price-weighted index requires rebalancing more than a market-capitalization weighted index.

【正确答案】 A

【答案解析】

After an equal weighted index is constructed and the prices of constituent securities change, the index is no longer equally weighted. Therefore, maintaining equal weights requires frequent adjustments (rebalancing) to the index.