00:01
So here first of all we will calculate the total market value of all three stocks.
00:05
Then we'll calculate the initial index value.
00:10
And we will calculate the current weight of each stock based on the current market values.
00:17
Then we will calculate the weighted stock prices based on the current prices.
00:23
So we will add up weighted prices to get the current index value.
00:28
So let us just do that.
00:31
So for stock one we will talk about, the market value would be $3 ,000.
00:38
Yes.
00:45
Then for stock two, it would be $4 ,000.
00:51
And for stock three, it would be $5 ,000 ,000.
01:01
Yes.
01:02
So let us just add up these total value we are calculating here, yes.
01:12
It would be we will add it up so total value would be equals to 12 .50 ,000 yes dollars.
01:31
Now initial index value.
01:34
So initial stock prices are all $100.
01:38
So the value weighted index starts at the baseline of $100 for sure.
01:44
So this is dollar 100.
01:46
This is dollar 100.
01:47
This is dollar 100...