{"id":3750,"date":"2018-04-22T02:53:00","date_gmt":"2018-04-22T02:53:00","guid":{"rendered":"http:\/\/34.239.104.200\/?p=3750"},"modified":"2026-07-14T19:23:43","modified_gmt":"2026-07-14T19:23:43","slug":"currency-cross-rates","status":"publish","type":"post","link":"https:\/\/analystprep.com\/blog\/currency-cross-rates\/","title":{"rendered":"CFA Study Guide \u2013 Calculating Currency Cross Rates"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">In this short post, we&#8217;ll be looking at calculating currency cross rates. If you understand how to do these calculations, this will give you easy points in your CFA exam.<\/p>\n\n\n\n<!--more-->\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_83 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/analystprep.com\/blog\/currency-cross-rates\/#This_is_the_3_steps_process_to_calculate_currency_cross_rates\" >This is the&nbsp;3 steps process to calculate currency cross rates:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/analystprep.com\/blog\/currency-cross-rates\/#Example\" >Example<\/a><ul class='ez-toc-list-level-4' ><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/analystprep.com\/blog\/currency-cross-rates\/#What_is_the_USDEUR_spot_rate\" >What is the USD\/EUR spot rate?<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"This_is_the_3_steps_process_to_calculate_currency_cross_rates\"><\/span>This is the&nbsp;3 steps process to calculate currency cross rates:<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ol class=\"wp-block-list\">\n<li>Set up the equation.<\/li>\n\n\n\n<li>Divide by 1\u00a0to switch the numerator and denominator of a spot rate you do not have.<\/li>\n\n\n\n<li>Multiply the spot rates.<\/li>\n<\/ol>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Example\"><\/span>Example<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p class=\"wp-block-paragraph\">Let&#8217;s say you are given:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>EUR\/GBP =\u00a00.78<\/li>\n\n\n\n<li>CAD\/GBP =\u00a00.54<\/li>\n\n\n\n<li>USD\/CAD =\u00a01.28<\/li>\n<\/ul>\n\n\n\n<div style=\"margin: 18px 0;\">\n  <a style=\"display: block; text-align: center; padding: 14px 18px; border: 2px solid #2F5BFF; border-radius: 18px; color: #ffffff; font-weight: 600; font-size: 16px; text-decoration: none; background-color: #1a73e8;\" \n     href=\"https:\/\/analystprep.com\/free-trial\/\" \n     target=\"_blank\" \n     rel=\"noopener noreferrer\">\n    Master currency cross rate concepts with AnalystPrep\u2019s Free Trial.\n  <\/a>\n<\/div>\n\n\n\n<h4 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_USDEUR_spot_rate\"><\/span><strong>What is the USD\/EUR spot rate?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h4>\n\n\n\n<p class=\"wp-block-paragraph\">First, we need to set up the equation:<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\">USD\/CAD x CAD\/GBP x&nbsp;GBP\/EUR<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">= USD\/<del>CAD<\/del>&nbsp;x&nbsp;<del>CAD<\/del>\/<del>GBP<\/del>&nbsp;x&nbsp;<del>GBP<\/del>\/EUR = USD\/EUR<\/p>\n<\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">But we don&#8217;t have GBP\/EUR, so we will have to divide the spot rate by 1.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"has-text-align-left wp-block-paragraph\">GBP\/EUR = 1\/EUR\/GPB = 1\/0.78 =&nbsp;1.28<\/p>\n<\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">Then, when we have every spot rate, we simply multiply everything:<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\">\n<p class=\"wp-block-paragraph\">USD\/CAD x CAD\/GBP x&nbsp;GBP\/EUR<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>USD\/CAD = 1.28<\/li>\n\n\n\n<li>CAD\/GBP =\u00a00.54<\/li>\n\n\n\n<li>GBP\/EUR =\u00a01.28<\/li>\n<\/ul>\n\n\n\n<p class=\"wp-block-paragraph\">USD\/EUR = 1.28 x 0.54 x 1.28 =&nbsp;0.88<\/p>\n<\/blockquote>\n\n\n\n<p class=\"wp-block-paragraph\">If you would like to practice questions&nbsp;on&nbsp;this topic, consider our&nbsp;<a href=\"https:\/\/analystprep.com\/\">CFA Level 1 Question Bank<\/a>.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Simon<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">simon.royal@analystprep.com<\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-analystprep wp-block-embed-analystprep\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"yaGDzh5Rdr\"><a href=\"https:\/\/analystprep.com\/shop\/all-3-levels-of-the-cfa-exam-complete-course-by-analystprep\/\">All 3 Levels of the CFA Exam &#8211; Complete Course offered by AnalystPrep<\/a><\/blockquote><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; visibility: hidden;\" title=\"\u201cAll 3 Levels of the CFA Exam \u2013 Complete Course offered by AnalystPrep\u201d \u2014 AnalystPrep\" src=\"https:\/\/analystprep.com\/shop\/all-3-levels-of-the-cfa-exam-complete-course-by-analystprep\/embed\/#?secret=KXFmAblSIx#?secret=yaGDzh5Rdr\" data-secret=\"yaGDzh5Rdr\" width=\"600\" height=\"338\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Photo by&nbsp;<a href=\"https:\/\/unsplash.com\/photos\/GcnPjvqRL18?utm_source=unsplash&amp;utm_medium=referral&amp;utm_content=creditCopyText\">Maria Imelda<\/a>&nbsp;on&nbsp;<a href=\"https:\/\/unsplash.com\/search\/photos\/currency?utm_source=unsplash&amp;utm_medium=referral&amp;utm_content=creditCopyText\">Unsplash<\/a><\/p>\n\n\n\n<div style=\"text-align: center; margin: 30px 0;\">\n  <a style=\"display: inline-flex; align-items: center; justify-content: center; padding: 12px 26px; border-radius: 9999px; background: #1e5bd8; color: #ffffff; font-weight: bold; text-decoration: none;\" \n     href=\"https:\/\/analystprep.com\/free-trial\/\" \n     target=\"_blank\" \n     rel=\"noopener noreferrer\">\n    Start Free Trial \u2192\n  <\/a>\n  <p style=\"margin-top: 12px; font-size: 16px; line-height: 1.5;\">\n    Strengthen your understanding of currency cross rates with AnalystPrep study notes, practice questions, and mock exams.\n  <\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>In this short post, we&#8217;ll be looking at calculating currency cross rates. If you understand how to do these calculations, this will give you easy points in your CFA exam.<\/p>\n","protected":false},"author":1,"featured_media":7896,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[70],"tags":[],"class_list":["post-3750","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cfa","blog-post","animate"],"acf":[],"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/posts\/3750","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/comments?post=3750"}],"version-history":[{"count":5,"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/posts\/3750\/revisions"}],"predecessor-version":[{"id":15662,"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/posts\/3750\/revisions\/15662"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/media\/7896"}],"wp:attachment":[{"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/media?parent=3750"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/categories?post=3750"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/analystprep.com\/blog\/wp-json\/wp\/v2\/tags?post=3750"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}