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Suppose you are a euro-based investor who just sold Microsoft shares that you had bought six months ago. You had invested 10,000 to buy Microsoft
Suppose you are a euro-based investor who just sold Microsoft shares that you had bought six months ago. You had invested 10,000 to buy Microsoft shares for $120 per share; the exchange rate was $1.55 per euro. You sold the stock for $135 per share and converted the dollar proceeds into euro at the exchange rate of $1.50 per euro. How much of the return is due to the exchange rate movement? 3.75 percent 3.33 percent 12.50 percent 16.25 percent
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