The following are the net currency positions of a U.S.FI (stated in U.S.dollars).
Note: Net currency positions are foreign exchange bought minus foreign exchange sold restated in U.S.dollar terms.
$\begin{array}{l}
\begin{array}{lll}
\text {Currency}\
\text {Canaclian Dollay}\
\text {Euro}\
\text {Japane se Yen}\
\text {SWiss: Fiadc}\
\text {British Pound.}\
\end{array}
\begin{array}{lll}
\text {Net Position}\
\text {+U.S. \$ 1,200}\
\text {-U.S. \$ 245,900}\
\text {+U.S. \$ 505,000 }\
\text {-U.S. \$ 36,700}\
\text {+U.S. \$447,900}\
\end{array}
\end{array}$
What is the portfolio weight of the Japanese yen in this FI's portfolio of foreign currency?
A)+0.18 percent.
B)-36.62 percent.
C)+75.20 percent.
D)-5.47 percent.

Question

The following are the net currency positions of a U.S.FI (stated in U.S.dollars). 
Note: Net currency positions are foreign exchange bought minus foreign exchange sold restated in U.S.dollar terms.
$\begin{array}{l}
\begin{array}{lll}
\text {Currency}\
\text {Canaclian Dollay}\
\text {Euro}\
\text {Japane se Yen}\
\text {SWiss: Fiadc}\
\text {British Pound.}\
\end{array}
\begin{array}{lll}
\text {Net Position}\
\text {+U.S.  \$ 1,200}\
\text {-U.S.  \$ 245,900}\
\text {+U.S. \$ 505,000 }\
\text {-U.S. \$ 36,700}\
\text {+U.S. \$447,900}\
\end{array}
\end{array}$
 What is the portfolio weight of the Japanese yen in this FI's portfolio of foreign currency?
A)+0.18 percent.
B)-36.62 percent.
C)+75.20 percent.
D)-5.47 percent.

Quizplus · Accepted Answer

Portfolio weight of yen = $U.S. in yeno/total FX exposure
 -505,000/671,500 = 0.7520. The portfolio weight of the Japanese yen is calculated by dividing the net position of the Japanese yen by the total net positions of all currencies. The total net position is the sum of all net positions: $1,200 - 245,900 + 505,000 - 36,700 + 447,900 = 671,500$. The weight of the Japanese yen is $505,000 / 671,500 \approx 0.7520$ or 75.20 percent.

The Following Are the Net Currency Positions of a U