Why are these market returns calculations different?

In number 5 page 243, answer on page 253, book 6 performance eval

The return on the market is calculated using the portfolio weights (not market allocation; market)

Questin 9, 2007 shows market return as the benchmark weight times the benchmark return…

Whats the deal?

this attribution stuff is a mess i tell ya.

what you mentioned is a valid concern for me as well.

another concern just to add on top of your misery is that:

when doing 2 period attribution,

market allocation formula is actually pure sector allocation formula.

I give up in trying to find the explanation for these and just went with the book.

I’m punting multiperiod LeFebvre said its probably outside of scope…I’m hoping he’s right

The problem with this is that the book seems like it would be wrong. if you use to weight in the portfolio it includes the allocation effect on the market.

anyone have input on this?

I have decided to skip it too! too many moving parts there… just makes my mind dizzy

Not sure of the specific questions, but market return can be calculated differently depending on the context. For a portfolio’s total return decomposition, you use portfolio weights. For performance attribution using a global index, you use benchmark weights. Perhaps the old exam is assuming a particular context.

Little piece of advice, I don’t expect the whole return decomposition question to show up in the exam. Most probably you would see a piece calculation question like currency allocation return or security selection return. Memorize the formula, understand it thoroughly so that you can pick right weights and returns and you should be good.

rolo, in 2007 Q9. It uses portfolio weights, bmk weights are not provided. It’s something like (wjp*Bj).

I don’t expect it’ll show up since I most likely get it wrong under stress…God bless cfa candidates.