You are an investor evaluating a depository receipt issued by Chinas Sinopec Group and selling as an
Question:
You are an investor evaluating a depository receipt issued by China’s Sinopec Group and selling as an N-share on the NYSE. Sinopec Group’s net asset value in Chinese new yuan is CNY 20 billion. The current spot exchange rate is CNY 6.25/$. Sinopec’s N-shares sell for $30 per share on the NYSE. There are 100 million shares outstanding.
a. What is the NAV in U.S. dollars?
b. Is this a good investment for a U.S. investor?
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a To calculate the Net Asset Value NAV in US dollars we need to convert the NAV from Chinese new yua...View the full answer
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