RESEARCH / RELATIONSHIPS / EVIDENCEREFERENCE EDITION / 15 OCTOBER 2026
Cross Asset
Research

Equities, rates, currencies and commodities.
Understand the transmission. Inspect the evidence.

Research Calculation Lab

Currency return calculator

Translate local-asset and currency returns into a base-currency result, including the interaction term.

Set the assumptions.

Currency return means the change in USD value of one unit of the asset currency. A negative input means that currency weakened against USD. Local return includes whatever income definition the user has chosen; the tool adds none.

Hypothetical calculation
+2.60%

Base-currency return

Local-asset component
+8.00%
Currency component
-5.00%
Interaction term
-0.40%
Ending value (USD)
$1,026,000

The calculation

Base-currency return = (1 + local return) x (1 + currency return) - 1. In percent units, the interaction term is local return x currency return / 100. Adding the two input returns alone omits this term.

Read the worked method

What the result covers

The result has no hedging, tax, fees, transaction costs or intermediate cash flows. It uses aligned holding periods for asset and currency returns. A hedged investment needs a separate hedge payoff and cost calculation.

Read the underlying guide

Search the research