Is there a change?

Discussion in 'Options' started by aamg, Nov 24, 2010.

  1. aamg


    There's a formula for calculating USDX:


    Is it stable forever?
    We see that EURUSD and GBPUSD have negative powers in this formula. What's the reason? I guess the reason is that EUR and GBP are more powerful currencies than USD. So for example right now that cad is more powerful than USD, can it be a factor to change the formula?
  2. Great first post!

    ... for an options BB
  3. No. AFAIK it is trade weighted and is recalibrated

    The coefficients are negative because the USD is the
    "terms," or right-hand side, of the pair. If USD were
    the "base," or left-hand side, the coefficients would
    be positive.
  4. aamg


    Thanks a lot my friends.
  5. aamg


    And I would know is that correct right now?