Did you know...?

Don't know whether I've posted about this before - apologies if I have, but I've just had one of those "join the dots" moments.  Why, when the pound falls against the dollar, does the FTSE tend to do well, and vice versa?  Well, the majority of the companies which make up the FTSE tend to be multinationals and do their accounting in US dollars.  The FTSE on the other hand does its accounting in pounds sterling.  So company profits or losses (in dollars) have to be converted into pounds for FTSE purposes,  And if the pound weakens against the dollar - meaning your dollar buys more pounds - any profit is exaggerated on conversion into pounds and any loss reduced.  And there you have it.