Market weighted Average TEV
Hello,
Just a quick question on how this is compiled. Is each stock's accumulated TEV compared to its market cap to produce the percentage? From there I would imagine each stock is weighted according to their share of the total market cap and then added together to produce the final result?
Thanks,
Bernie
Market weighted vs. voting
Pascal, this brings up a question that has been in the back of my mind for a while. Many components of MF analysis are market weighted, which is market cap weighted according to your answer to Bernie's question. Quite a few of the stocks in the MF universe are very, very low capitalization, such as ENER ($20 million), CSKI (under $40 million), FEED (under $30 million), etc. In total about 100 are under $1 billion, while about 300 have market caps over $10 billion and about 30 have market caps over $100 billion. Of course what this means is that when market weighting, it would seem that the MF related results are dominated by a relatively small number of companies. There is a range of over 10,000:1 in market caps.
On the other hand there seem to be a few parts of the system, like OBOS as far as I can tell, that are simply votes -- every company gets an equal vote in the outcome (or, at least, in its sector's outcome).
Of course most of the institutional funds we care about are going to/from the big cap stocks so this seems appropriate. I'm just wondering if this is an accurate portrayal.
Thanks,
-Mike