Indirect quote: Difference between revisions
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A foreign exchange rate quotation where the foreign currency amount is divided by the quoted rate, in order to calculate the domestic currency equivalent. | A foreign exchange rate quotation where the foreign currency amount is divided by the quoted rate, in order to calculate the domestic currency equivalent. | ||
'''Example''' | |||
From the perspective of a EUR-based entity, the exchange rate EUR 1 = 1.25 USD would be an indirect quote. | |||
USD 100m would be worth: | |||
100 / 1.25 | |||
= EUR 80m. | |||
Revision as of 23:00, 21 March 2015
A foreign exchange rate quotation where the foreign currency amount is divided by the quoted rate, in order to calculate the domestic currency equivalent.
Example
From the perspective of a EUR-based entity, the exchange rate EUR 1 = 1.25 USD would be an indirect quote.
USD 100m would be worth:
100 / 1.25
= EUR 80m.
