You invested $100,000 in British equities. The stock's price was 50 and the exchange rate was 0.50/$1.00.
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Question:
You invested $100,000 in British equities. The stock's price was 50 and the exchange rate was 0.50/$1.00. At selling time, one year after purchase, they were 45 and 0.60/$1.00. Assume the investor sold 50,000 forward at the forward exchange rate of 0.55/$1.00. The dollar rate of return would be:
-27.27%
1.09%
28.00%
-9.09%
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