Cone8
 ( 5.57% )
- ago
Here's a good example of the Multi-Currency effect. Scenario - you live in Europe, so your Base Currency is EUR, but you're trading USD instruments, like SPY. (Of course, you can't trade U.S. ETFs because you live in Europe, but ignore that for now.)

Check out this trade that bought 100 shares SPY in Oct 2022 when the EURUSD was near parity. The trade went south right away, so the MFE flat-lined until May this year. The green MFE is the non-base USD gain, but because the EUR gained around 8% on the USD, there's no change in the EUR-based MFE. Only in recent days has SPY overcome the loss in currency value, as observed by a tick up in the fuchsia-colored MFE and MFEPct...



Now contrast that with a Canadian making the same trade ...


0
587
2 Replies

Reply

Bookmark

Sort
- ago
#1
I've been playing wuth this feature, which is obviously fantastic for Global portfolios. It works very well with single stocks.

However I have noticed that it can cause some flawed results. If you include a USD denominated ETF, that is traded in Euro, it will convert the ETF to Euros for a second time. Below is the ETF that caused a bit of havoc in my modelling!

iShares V PLC - iShares MSCI ACWI UCITS ETF USD (Acc) (IUSQ.DE)
XETRA - XETRA Delayed Price. Currency in EUR
0
Cone8
 ( 5.57% )
- ago
#2
Thanks for bringing it up. Let's try to get to the bottom of it.

QUOTE:
..USD denominated ETF, that is traded in Euro..
I really don't know what that means because it sounds contradictory. The important thing is to make sure the system is recognizing the correct market for the symbol. The market has the currency information.

Let's use the IUSQ.DE example.
Here's a line of code to show the market and currency.

CODE:
DrawHeaderText($"{bars.Market.Name}, {bars.Market.Currency}", WLColor.Aqua, 16);

Here's the result.


On my system, the symbol source was the Yahoo! provider, which automatically identified the Frankfurt exchange, which has currency EUR . The Multicurrency feature will therefore treat these prices as EUR.

Do you have specific example that can demonstrate the contrary?
0

Reply

Bookmark

Sort