FX (foreign exchange) rate
An FX rate is the price of one currency expressed in another. It matters to a portfolio the moment you buy something quoted in a currency other than the one you count in. From then on the position has two moving parts: the price of the asset itself, and the rate at which that price is translated into your own currency.
Why it matters
A dollar holding can rise in dollars and fall in euros over the same month, or the reverse, and neither movement is visible if you convert everything at today's rate. Converting a whole history at one rate is the most common shortcut in a homemade tracker and the one that distorts the most, because it silently rewrites what every past purchase cost. Dividends carry the same problem: a payment received last spring converted at last spring's rate, not at today's.
How BullBenchmark shows it
We convert every transaction at the rate that applied on its own date, so a purchase made three years ago keeps the cost it had three years ago, and we do the same for each dividend on the day it landed. Rates update daily, which is enough for a tracker that settles on official closing prices rather than following ticks. The effect of holding several currencies at once is visible on the demo dashboard.
Related terms
Base currency · Market value · Withholding tax
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