Which of the following statements is FALSE?
A) Because very little trading is required to maintain it, an equal-weighted portfolio is called a passive portfolio.
B) If the number of shares in a value weighted portfolio does not change, but only the prices change, the portfolio will remain value weighted.
C) The CAPM says that individual investors should hold the market portfolio, a value-weighted portfolio of all risky securities in the market.
D) A price weighted portfolio holds an equal number of shares of each stock, independent of their size.
A
Explanation: A) Because very little trading is required to maintain it, a value-weighted portfolio is called a passive portfolio.
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