Problem
Emerald Energy is an oil exploration and production company that trades on the London stock market. Assume that when purchased by a US$-based investor the stock's price and the exchange rate were £5 and $1.5625/£ respectively. At selling time, one year after purchase, they were £6 and $1.6667/£. Assume that the investor had sold forward £5, the principal investment amount at the same time that the stock was purchased, at the forward exchange rate of $1.5183/£1. Calculate the investor's annual percentage rate of return in terms of the U.S. dollars.