Answer: Using a floating weighting scheme rather than a fixed weighting

## Explanation In a **trending market**, the characteristic that most likely leads to higher returns is: **A: Using a floating weighting scheme rather than a fixed weighting** **Why floating weighting works better in trending markets:** - **Floating weighting** (like momentum-based weighting) allows winners to continue rising - It increases weights in commodities that are trending upward - Decreases weights in commodities that are trending downward - This captures and amplifies the trend effect **Why the other options are incorrect:** - **B: Increased rebalancing frequency** - This would actually hurt returns in trending markets by cutting off trends prematurely - **C: Large weight in contango commodities** - Contango creates negative roll yields, which reduces returns, especially in trending markets **Floating weighting** allows the index to dynamically adjust to market trends, making it the best choice for trending market conditions.

Author: LeetQuiz Editorial Team