One of the favorite financial forex indexes to mention is the one comparing the US Dollar to the Canadian Dollar. The index is called USDCAD and is traded daily when the stock market opens. It is free for investors who have private funds as well as for public retirement and investment funds.

What is USDCAD?

Even though the American and Canadian economies are interconnected, there is not so much dependency on the United States as it used to be. The Canadian Dollar free floats and goes up or down according to the market power. USDCAD is one of the most stable forex indexes historically. That happens because it has a yield over the interest rates offered by the central banks in both countries. Every trader who wants to understand how to invest in USDCAD must remember that it may result in losses and be prepared to lose money.

How does the USDCAD market work?

The USDCAD market works in an automated environment. All the call or put options come automatically in the index through the SimpleFX platform. Investors must pay attention to the index to ensure placing the right order at the right time. The index has new indications and values every 15 seconds during business hours and weekends. Some investors try to gain access to the index when the markets are closed to perform short selling, which is quite a popular strategy. For all willing to learn how to trade USDCAD without risk, SimpleFX offers a demo account where traders can take their first steps into the forex market.

USDCAD price history

Here is the latest 5-year history for the USDCAD index:

2018

In 2018, the USDCAD index was close to the current price of 1.36 CAD for 1 USD. It remains impressive that the price didn't fluctuate throughout the year, showing similar fiscal policies from the two governments.

2019

There was no further development in 2019 for the USDCAD index. The price was relatively stable at 1.37 CAD for 1 USD. Long-term investors used to have more patience during 2019 and opened long positions to the index with the hope of having more profits in the short future.

2020

When 2020 arrived, there was a halt in economic production both in the United States and Canada. However, because of the advantageous position of Canada in the net exporting energy sector, the USDCAD index plummeted close to 1.30 CAD for 1 USD. That was the lowest we have seen for ages, and it sent a clear message to investors to buy the Canadian Dollar as a profitable investment for the future.

2021

During 2021, there were several great opportunities for the American economy. However, due to the hyperinflation in the American market, the USDCAD went a little while close to 1.20 CAD for 1 USD, placing 1.34 CAD to 1 USD by the end of the year.

2022

Last year was a real mess for the Canadian economy, which was flooded with issues from the financial sector. The local inflation worked in favor of the USD, and that's why the USDCAD index went up to 1.37 CAD for 1 USD, bringing back the balance to the two countries' trading relations.

Current USD / CAD exchange rate

The current USD / CAD exchange rate is subject to fluctuation due to the volatility of the forex market. Investors can check it on the chart or the SimpleFX Webtrader platform.

Is USDCAD a good investment?

Whether USDCAD is a good investment depends on factors such as interest rates, monetary policies, geopolitical events, etc. The answer depends on analyzing these factors and the potential returns on investment. If the factors are also stable and there are more chances of return, this currency pair brings more interest from investors eager to learn how to invest in forex worldwide.

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