Base, share-class and trading currency: keeping three numbers honest

A single trade can touch three currencies before it reaches a NAV. The currency it settles in. The currency the share class is denominated in. The currency the fund reports in. Most NAV errors trace back to the translation between these three, done by hand, on a spreadsheet nobody fully trusts.

The sequencing problem

Translation has to happen in the right order, and against the right rate, every time. Do it out of sequence and small errors compound across a portfolio of positions. Do it against a stale rate and the error is invisible until somebody reconciles cash against the custodian statement.

The fix is to treat currency as a property of the position, not a separate calculation layered on top. Each trade carries its own currency data from the moment it is booked. Translation runs the same way, every time, against a rate source the ledger already trusts.

What good looks like

Base, share-class and trading currency should always reconcile to each other automatically, with no manual step in between. If they do not, that is a signal worth investigating immediately, not at month-end.

Funds that get this right stop treating multi-currency as a special case. It becomes a configuration, the same way adding a new fund or a new market becomes a configuration once the underlying ledger is built for it.