How "close" are a series of price
indices to a series of fundamental values?
It turns that this relatively simple
question can be (and actually has been) answered in many different ways. This website
calculates several measures that have been used in the literature on
experimental asset markets.
An obvious criticism of this state of affairs is that different
measures give different answers. Which measure is "correct"? I (partially) address this concern
by using the criteria of "numeraire independence" to derive the GD
and GAD measures, which are unique under certain conditions (Powell, 2016).