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Originally Posted by Mick
Don't you find it hilarious that when say the other day, I said the FTSE was reaching record levels, which is it was, it quickly got dismissed as, 'it's to do with global trade.'
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But a good part of it is. FTSE companies largely earn cash from abroad and therefore the weaker pound strengthens it's value relative to the GBP denominated FTSE.
http://www.cityam.com/260961/why-fts...ned-two-charts
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Consider a simplified scenario of currency movement. If the exchange rate was $2 to the pound then every $1,000 of revenue would be worth £500. However, if sterling weakened and the exchange rate moved to $1.5 to the pound, then every $1000 of revenue would be worth £667. The outcome is that revenues increased 33% as a result of the fall in sterling.
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If you were to measure their value in USD then it's still risen but not as dramatically.