# Global Performance Evalution Question 2

I can’t understand the currency allocation of this problem #2 EOC reading 42, solution on page 249.

How did they get 0.0194 as the dollar return on the europe index - euro return on the index? pulling out my hair trying to figure this out.

The book doesn’t load for me , too little space on my iPad. Use the search on this one. I think CPK answered this earlier.

if I remember right the currency return is the dollar return minus the local return . Those two components can be calculated for UK and France easily . Then convert beginning and ending values in GNP and euro to their dollar equivalents and get the dollar return for each. Subtract. Currency return for us investments is zero .

i’m still not getting it. Maybe i’m not typing in the right keyword on the search, but i’m not seeing any threads on this question. Thanks!

Euro return = -5% on index

Dollar return on same index ( 95/0.98 )/(100/1) -1 = -3.06 % .

So \$ ret - euro ret = 1.94 %

thank you so much.