Back in 2002 for a US resident, there was a way to save 50% on the exact same item. All she or he had to do is go north and buy it in Canada. Now the table has turned, ever since 2003, the greenback is slowly getting weaker against the loonie. No one back then would have imagined that it would be at par and now it’s trading at a discount versus the Canadian dollar.

Over the past year, this has been the hottest topic. This entices me to talk more about the USX in my “Intermediate option workshops”. I love talking about the USX. Everytime I introduce this product to investors, their eyes light up. They see opportunities and the sky’s the limit. So, what is this USX? It is an option on the US dollar. The currency pair is the US vs. CAD. It’s a Canadian option, so you can trade it in your option account. No need to set up a FOREX account. Now, just like any option, if you are bullish on the USD, you would buy a call. If you are bearish, you would buy a put. Hence, we can apply the same option strategies with the USX. This is good for speculators and also hedgers.

They say: “What goes up must come down and what goes down must come up (hopefully)”. For those who have faith in the greenback and believe that it will bounce back up, here’s a strategy for you. Buy calls or sell puts on the USX. Note that each strategy has its own bullishness outlook. If you’re outright bullish on the USD, you should buy the call because your potential profit is unlimited with limited risk. However, if you are somewhat moderately bullish on the USD, you should write puts and cash in the premiums. The premium that you receive is your maximum profit, yet the risk is quite substantial if you’re wrong. Hence, it’s your take on the USD, make sure that you use the right strategy that corresponds to your outlook.

The USX has gained lots of popularity and volume has gone up significantly ever since the USD became so volatile. For those who like numbers, the volume on the USX has gone up 334% compared to last year’s volume. For more info, you can check out our USX option manual.