USDX vs. DX vs. DXY

If you’ve Googled “U.S. Dollar Index”, you might’ve seen three acronyms associated with the phrase: USDX, DX, and DXY and wondered, “What the heck is the difference between them?!”

What is USDX?

USDX is the umbrella term for the U.S. Dollar Index. You can’t go wrong using this term if you’re talking about the original dollar index.

What is DX?

The ICE Exchange symbol for the futures contract is DX, followed by the month and year code.

The ICE Exchange symbol for the value of the underlying Dollar Index (sometimes called the cash or spot index) is also DX (without a month or year code), although different data providers may use different symbols.

What is DXY?

DXY is a popular ticker or symbol used by Bloomberg Terminal users so that index is sometimes referred to as the “Dixie.”

DXY is more commonly used when referring to the dollar cash or spot rate, while DX is geared more for futures traders. Although as mentioned, DX can also refer to the spot rate as well. Confusing right? 🤯

US Dollar Index (USDX) Components

Now that we know what the basket of currencies is composed of, let’s get back to that “geometric weighted average” part.

Because not every country is the same size, it’s only fair that each is given appropriate weights when calculating the U.S. dollar index.

Check out the current weights:

With its 19 countries, euros make up a big chunk of the U.S. Dollar Index.

The next highest is the Japanese yen, which would make sense since Japan has one of the biggest economies in the world.

The other four make up less than 30 percent of the USDX.

Here’s a question…

When the euro falls, which way does the U.S. Dollar Index move?

The euro makes up such a huge portion of the U.S. Dollar Index, we might as well call this index the “Anti-Euro Index“.

FUN FACT: Before the creation of the euro, the original USDX contained ten currencies: the ones that are currently included (except the euro), plus the West German mark, the French franc, the Italian lira, the Dutch guilder, and the Belgium franc. The euro replaced the last five of these currencies.

Because the USDX is so heavily influenced by the euro, traders have looked for a more “balanced” dollar index.

We will cover two other U.S. dollar indexes later:

1. Trade Weighted Dollar Index
2. Bloomberg Dollar Spot Index

As a currency trader, you should be familiar with ALL three of them.

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