Dollar Bear

AAA

DEFINITION of 'Dollar Bear'

An investor or speculator who is negative on the outlook for the U.S. dollar against other currencies. A dollar bear expects the U.S. dollar to decline against major currencies over time, and will take this factor into consideration when positioning investment portfolios.

INVESTOPEDIA EXPLAINS 'Dollar Bear'

Dollar bears generally possess a gloomy outlook on the long-term prospects for the U.S. economy.They will bet against the dollar in general or specifically in relation to another currency. For example they could go long the EUR/USD pair because as the pair increases it signifies that the USD is worth less. Since the U.S. dollar has a strong negative correlation with precious metals and commodities, a dollar bear may overweight investment portfolios in assets such as gold and base metals as a hedge against a continued decline in the greenback.

RELATED TERMS
  1. Search Theory

    A study of buyers and sellers who cannot instantly find a commerce ...
  2. Bear Position

    Alternate term for a short position in a financial security. ...
  3. Dollarization

    A situation where the citizens of a country officially or unofficially ...
  4. USD (United States Dollar)

    The currency abbreviation for the United States dollar (USD), ...
  5. Trade-Weighted Dollar

    A measurement of the foreign exchange value of the U.S. dollar ...
  6. U.S. Dollar Index - USDX

    A measure of the value of the U.S. dollar relative to majority ...
RELATED FAQS
  1. What is the correlation between American stock prices and the value of the U.S. dollar?

    The correlation between any two variables (or sets of variables) summarizes a relationship, whether or not there is any real-world ... Read Full Answer >>
  2. How did the financial crisis affect the oil and gas sector?

    The financial crisis had a negative impact on the oil and gas sector as it led to a steep decline in oil and gas prices and ... Read Full Answer >>
  3. What is the difference between a bank's liquidity and its liquid assets?

    A company's liquid assets can easily be converted into cash to meet financial obligations on short notice. Liquidity is the ... Read Full Answer >>
  4. How are risk weighted assets used to calculate the solvency ratio in regulatory capital ...

    Risk-weighted assets are the denominator in the calculation to determine the solvency ratio under the provisions of the Basel ... Read Full Answer >>
  5. What happens when a company defaults on its commercial paper obligations?

    As a practical matter, the Issuing and Paying Agent, or IPA, is responsible for reporting the commercial paper issuer's default ... Read Full Answer >>
  6. Can small investors buy collateralized mortgage obligations (CMOs)?

    Collateralized mortgage obligations (CMOs), which are pools of mortgage-backed securities (MBS), are available to smaller ... Read Full Answer >>
Related Articles
  1. Forex Education

    Play Foreign Currencies Against The U.S. Dollar And Win

    Don't panic when the dollar drops. Learn to exploit the greenback's decline and profit from it.
  2. Forex Education

    Profiting From A Weak U.S. Dollar

    Learn how to allocate your investments when the U.S. dollar is down.
  3. Forex Education

    Gold: The Other Currency

    Throughout history, gold has held its value against paper currencies. Learn how it can help offset market risks.
  4. Forex Education

    Dollarization Explained

    Find out how fledgling economies can find some stability in their currency and attract foreign investment.
  5. Bonds & Fixed Income

    6 Factors That Influence Exchange Rates

    Find out how a currency's relative value reflects a country's economic health and impacts your investment returns.
  6. Forex Education

    3 Factors That Drive The U.S. Dollar

    We look at three important factors that affect U.S. dollar value, and how to determine when it's the right time to buy currency.
  7. Options & Futures

    How U.S. Firms Benefit When The Dollar Falls

    When the greenback is weak, smart investors will invest in multinational companies to benefit.
  8. Investing

    What A Rate Hike May Mean For Stocks

    By the end of the year, investors will likely be contending with the first Federal Reserve (Fed) rate hike in nearly a decade.
  9. Forex Strategies

    What Makes the EUR/USD A Risky Trade Now?

    What are the current risks of trading the EUR/USD pair? The Fed may raise interest rates this summer and the ECB has begun a quanitative easing program.
  10. Investing

    Market Crisis: Does Diversification Still Work?

    If you still aren’t sold on the benefits of international diversification, you may object that: Diversification didn’t work during the last market crisis.

You May Also Like

Hot Definitions
  1. Mixed Economic System

    An economic system that features characteristics of both capitalism and socialism.
  2. Net Worth

    The amount by which assets exceed liabilities. Net worth is a concept applicable to individuals and businesses as a key measure ...
  3. Stop-Loss Order

    An order placed with a broker to sell a security when it reaches a certain price. A stop-loss order is designed to limit ...
  4. Covered Call

    An options strategy whereby an investor holds a long position in an asset and writes (sells) call options on that same asset ...
  5. Butterfly Spread

    A neutral option strategy combining bull and bear spreads. Butterfly spreads use four option contracts with the same expiration ...
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center