I work for a european company which invests mostly in the euro zone but also in the UK. I'm in charge with calculating the hurdle rate targeted for these investments.
The internal guidelines are for euro labeled projects. But I'm trying to figure out the hurdle rate required for GBP labelled projects.
Let's say I have a target return of 10% in the Euro zone. The current exchange rate EUR:GBP 1:0.89. the target IRR for UK prjects becomes 8.9%
Is it the right method ?