Canadian Currency Exchange

Canadian Currency Exchange » comptroller of the currency and spain currency

1. richards24
   Member

   i am at times inquired as to the meaning of benchmark error.
   The meaning of benchmark error is a situation in which the wrong benchmark is selected in a financial model. This error can create large dispersions in an analyst or academic's data, but can easily be avoided by selecting the most appropriate benchmark at the onset of an analysis.
   When creating a market portfolio under the capital asset pricing model (CAPM), it is important to use the most appropriate benchmark, or market, in your calculations. If, for example, you want to create a portfolio of American stocks using the CAPM, you would not use the Nikkei - a Japanese index - as your benchmark.
   Accordingly, if you want to compare your portfolio returns, you should use an index that contains similar stocks. For example, if your portfolio is tech-heavy, you should use the Nasdaq as your benchmark, rather than the S&P 500.

   Posted 5 months ago #
2. harper_marquise
   Member

   what richards24 said

   Posted 5 months ago #

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