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Wikitoro author Mike Druttman Written by Mike Druttman
Wikitoro fact checker Wikitoro Team Fact checked by Wikitoro Team
Updated Feb, 2024

What You Need to Know

The US Dollar Index (DXY, USDX, USDOLLAR) is a crucial tool for traders aiming to assess the value of the US dollar against a basket of major currencies used by its trading partners. This index reflects the dollar's strength or weakness relative to six foreign currencies based on their exchange rates. A rising index indicates a strengthening US dollar, while a falling index suggests it's weakening. For those interested in trading this specific investment product, it's available on the eToro platform. This guide offers detailed insights and personal experiences on how to invest in this intriguing asset on eToro, so keep reading for valuable information.

Trade the USD Index!

76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

 

Trading US Dollar via CFD

It's important to understand that trading the US Dollar Index on eToro involves CFDs (Contracts for Difference), not direct stock exchange trading. CFD trading is appealing due to its speculative nature on the indices market movements. CFDs allow traders to profit from price fluctuations without owning the underlying asset. The value of a CFD contract is based on the price difference between when the trade is entered and exited. With skillful execution, CFDs can yield a Return on Investment (ROI) regardless of market direction.

 

Why I Prefer Trading US Dollar on eToro

Having traded this asset on eToro on multiple occasions, I've identified several key advantages:

  • User-friendly interface: eToro's platform is intuitive and easy to navigate.
  • Flexibility in scheduling: The platform allows setting pre-orders even when the market is closed.
  • No transaction fees for index trades: This reduces the cost of trading on indices.
  • Leverage options: eToro provides leverage, enabling traders to open larger positions with a smaller capital commitment. Note that leverage limits vary based on your country of residence.

 

The US Dollar Asset Page on eToro

When you access the US Dollar asset page on eToro, you'll land on the Overview section, which serves as the default hub for several key features:

  • Graph: Displays the asset's performance through a basic graph. A more detailed graph is available in another tab.
  • About: Provides brief information about the index.
  • Latest News: Offers current news relevant to the US Dollar, sourced from CityFALCON.
  • People Also Bought: Shows other popular eToro indices that traders are investing in.
  • Copy Investors: Lists top-performing traders focused on this index. Click the "Copy" button next to a trader to engage in copy trading.
  • Discussions: Features posts and conversations about the US Dollar. You can filter to see top discussions or all discussions, similar to social media platforms like Facebook and Twitter, where you can like, comment, or share posts.
eToro US Dollar index trading page
eToro US Dollar index trading page

 

Useful Index Trading Tools on eToro

The integrated tools on eToro's platform streamline the trading experience, eliminating the need to switch between apps or screens. Notable tools include:

  • Chart: An advanced live chart for the US Dollar, customizable to display intervals from 1 minute to 1 week.
  • News and Sentiment Trends: Shows the latest news about the US Dollar, also powered by CityFALCON, indicating the news mood (positive, negative, or neutral). The Sentiment Trends section quantifies the general sentiment about the topic, displaying a 30-day average sentiment along with daily sentiment scores and top stories.

 

Trading the US Dollar on eToro

To trade this index on eToro, search for the underlying asset, select "BUY" or "SELL", input your investment amount, set your trading preferences, and execute the trade.

Buying US Dollar index on eToro
Buying US Dollar index on eToro

 

Maximizing Your eToro Experience

To effectively invest in the US Dollar index on eToro, it's crucial to understand the platform's features and tools. These insights apply to both the web-based platform and the mobile app. Remember to apply these tips judiciously in your trading activities and enjoy the comprehensive experience that eToro offers!

 

eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.

Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision.

Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk.

Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply. Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment, and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.

eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.

Wikitoro author Mike Druttman About Mike Druttman

Mike Druttman, Head of Content at Wikitoro.org, has decades of expertise in marketing communications and business matching. Educated at the CAM Foundation and the Chartered Institute of Marketing, Mike has collaborated with businesses from the UK to Japan. He founded KEYZUNA, bridging Japanese businesses with global innovations. With a diverse background spanning high-tech to hospitality, Mike's articles at Wikitoro reflect his vast knowledge and unique perspective.

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