[CFA Level I] 18, Index Weights and Rebalancing Effects

This podcast is made by Ran Chen, who holds an EA license, Insurance and Securities licenses (Series 6, 63, 65), and the CFP® designation. He is passionate about opening access to high-quality exam preparation resources and helping learners prepare more effectively for professional certification exams. In this episode you will learn: * Differences between price-weighted, market-capitalization-weighted, and equal-weighted indices. * How stock splits affect price-weighted index divisors and constituent weights. * Why higher share price does not imply a larger company or higher market capitalization. * Self-adjusting properties of market-cap weighted indices during corporate actions. * Rebalancing effects, turnover, and contrarian tilts in equal-weighted index strategies. This independent study resource is designed to help candidates master Level I concepts. Access free practice questions at https://open-exam-prep.com/practice/cfa-level1 and watch video explanations on YouTube at https://www.youtube.com/@Open-exam-prep . Sources checked: October 12, 2026 https://www.cfainstitute.org/programs/cfa-program/candidate-resources/level-i-exam https://www.cfainstitute.org/sites/default/files/curriculum-update-2027.pdf