Shares of the bank trading on polish exchange

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1) An ADR of Bank of Poland is a claim on 2 shares of the bank trading on the Polish exchange. Each share is worth 32 PLN (polish zloty). If the PLN is currently trading in the spot currency market at 0.25 USD/PLN, what should be the approximate price of the ADR in the US market?

2) You just bought some ADRs of GSK. You expect that the shares of the company, currently trading on the London Stock Exchange at 40 GBP per share, will appreciate over the next year by 10.03%. You expect that over the same time period, the value of the British pound (GBP), which is currently trading at 1.25 USD/GBP, will depreciate by 12.45% relative to the USD. What is the net rate of return that you expect on your ADRs for the next year? (Enter answer in percents, to two decimal places.)

Reference no: EM131955603

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