Calculate the contribution to total performance from currency, country, and stoc

Question

Calculate the contribution to total performance from currency, country, and stock selection for the manager relative to EAFE in the following table. All exchange rates are expressed as units of foreign currency that can be purchased with 1 U.S. dollar. (Round your answers to 2 decimal places. Do not round intermediate calculations. Input all amounts as positive values. Omit the "%" sign in your response.)

EAFE Weight

Return on
Equity Index

E1/E0

Manager's Weight

Manager's Return

  Europe

0.6

15

%

1      

0.6   

12

%

  Australasia

0.3  

16

1.4      

0.1   

17

  Far East

0.1  

20

1.2      

0.3   

17

Profit/Loss

  Country Selection

%

(Click to select)LossProfit

  Stock Selection

%

(Click to select)ProfitLoss

Calculate the contribution to total performance from currency, country, and stock selection for the manager relative to EAFE in the following table. All exchange rates are expressed as units of foreign currency that can be purchased with 1 U.S. dollar. (Round your answers to 2 decimal places. Do not round intermediate calculations. Input all amounts as positive values. Omit the "%" sign in your response.)

Explanation / Answer

Currency Selection EAFE/ Manager weight × Currency appreciation EAFE Weight Manager’s Weight E1/E0 EAFE WT*Currency appreciation Manager's WT**Currency appreciation   Europe 60.0% 60.0% 0.0% 0.0% 0.0%   Australasia 30.0% 10.0% 40.0% 12.0% 4.0%   Far East 10.0% 30.0% 20.0% 2.0% 6.0% 14.0% 10.0% Loss of- 4% relative to EAFE Country selection: EAFE/ Manager weight × Return on Equity Index EAFE Weight Manager’s Weight Return on Equity Index EAFE WT*Return on Equity Index Manager's *Return on Equity Index   Europe 60.0% 60.0% 15.0% 9.0% 9.0%   Australasia 30.0% 10.0% 16.0% 4.8% 1.6%   Far East 10.0% 30.0% 20.0% 2.0% 6.0% Profit of .8% relative to EAFE 15.8% 16.6% stock selection :(Manager’s return - Return on Equity Index) × Manager weight EAFE Weight Manager’s Weight Manager's Return Return on Equity Index   Europe 60.0% 60.0% 12.0% 15.0%   Australasia 30.0% 10.0% 17.0% 16.0%   Far East 10.0% 30.0% 17.0% 20.0% Loss of- 2.60% relative to EAFE

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