nannan66

could you please give reference to the page.. i can't find that formula in SS17 in schweser books

nannan66

Here is perhaps an easier way to do it:
Rd= Domestic return
Rlc = Local currency return = Capital Gain + Yield Income = .08 +.01 = .09
S = currency spot appreciation = -0.02

Rd = Rlc + S + Rlc * S
Rd = .09 + -0.02 + (.09)(-0.02)
Rd = .0682