The Russell 1000 is a value-weighted index of the largest ~1,000 U.S. stocks. The Russell 2000...

Transcribed Image Text:

The Russell 1000 is a value-weighted index of the largest ~1,000 U.S. stocks. The Russell 2000 is a value-weighted index of the next largest ~2,000 U.S. stocks. The Russell 3000 is a value- weighted index of the largest ~3,000 U.S. stocks - it encompasses both stocks in the R1000 and stocks in the R2000. Use FactSet to extract end-of-year total return index values for three exchange-traded funds (ETFs) that mimic the Russell 1000 (ticker IWB), the Russell 2000 (IWM), and the Russell 3000 (IWV) from 2010 to 2016 (that is, 12/31/2010, 12/30/2011, ..., 12/30/2016), download this data to Excel, and compute annual returns for each index for the period 2011-2016. 2. Calculate the arithmetic average return, geometric average return and the standard deviation of returns for the three indices. Why are the return averages and the standard deviation of the R3000 closer to those of the R1000 than those of the R2000? The Russell 1000 is a value-weighted index of the largest ~1,000 U.S. stocks. The Russell 2000 is a value-weighted index of the next largest ~2,000 U.S. stocks. The Russell 3000 is a value- weighted index of the largest ~3,000 U.S. stocks - it encompasses both stocks in the R1000 and stocks in the R2000. Use FactSet to extract end-of-year total return index values for three exchange-traded funds (ETFs) that mimic the Russell 1000 (ticker IWB), the Russell 2000 (IWM), and the Russell 3000 (IWV) from 2010 to 2016 (that is, 12/31/2010, 12/30/2011, ..., 12/30/2016), download this data to Excel, and compute annual returns for each index for the period 2011-2016. 2. Calculate the arithmetic average return, geometric average return and the standard deviation of returns for the three indices. Why are the return averages and the standard deviation of the R3000 closer to those of the R1000 than those of the R2000?

Answer rating: 100% (QA)

As an AI language model I dont have direct access to external databases or FactSet However I can guide you through the process of calculating the arithmetic average return geometric average return and ... View the full answer