have a couple of nitty questions regarding the multi-national area. and this relates to schweser… and from the multi-national area of fsa (temporal, all-current etc.)… and the questions might be irrelevent as i can probably do everything without having these explained. 1) when schweser demonstrates flow effect at start of chapter with that revenue/cash example, they show flow effect as based on change of exchange rate thru year. but then when they do the flow effect on all-current they use ending exchange vs. average exchange??.. is there some reason it’s different? or just oversight? and i guess they can both be flow effects. it’s just confusing that they show general example and then change it up a page later without any note. 2) schweser has a comment about how people get confused that everything balances in S/E under all-current, even though the entries are based on different exchange rates… so schweser explains that CTA is a PLUG, which is fine… but then the very next thing they do is calculate intensively the CTA from scratch. to me, that’s NOT a PLUG… a PLUG is investment in fixed assets (capex) under emerging markets (high inflation). there you do put in any number that makes things balance (don’t really calculate it other basic addition) thanks in advance!!!.. and i said, i have worked around all this. would just like to find out if i misread or something.
on your 2nd point, I think that you can calculate CTA by either method, Plug or Actual Calculation ( translation = flow + hold). You’ll get the same answer. That Said, Schweser almost always calculates it as sum of holding and flow effect.