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Foreign Currency Translation Gains or Losses

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A Brazilian investor buys 1,000 Qualcom shares on January 1st 2008 at $20 per share. The investor liquidates her position on January 1st, 2009 at $35. During the same period USD/BRL rate moved from BRL 2.62 to BRL2.19 per dollar. Calculate the returns of the Brazilian investor from her Qualcom investment in Brazilian Real (domestic currency) terms.

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Solution Summary

This solution illustrates how to compute an investor's foreign currency gain or loss.

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