Returns on indexes

CFA Level I Equities
#1

I’m having hard time determining when to use which method, and the curriculum does not explain this.

(Curriculum Book 5 / page 94 / Eoc questions / 6-14 questions)

I don’t know when to use which method and for which index - to calculate returns on indexes:

  • % change in the price of index

  • arithmetic mean of % changes of single securities

for

  • price-weighted

  • market-cap weighted

  • value-weighted

  • equally-weighted

I mean, I can write it own and learn it by heart but wanted to actually grasp this