{"id":223245,"date":"2025-05-02T09:40:47","date_gmt":"2025-05-02T13:40:47","guid":{"rendered":"https:\/\/ibkrcampus.com\/campus\/?post_type=glossary-terms&#038;p=223245"},"modified":"2025-05-02T09:40:50","modified_gmt":"2025-05-02T13:40:50","slug":"u-s-oil-fund-uso","status":"publish","type":"glossary-terms","link":"https:\/\/www.interactivebrokers.com\/campus\/glossary-terms\/u-s-oil-fund-uso\/","title":{"rendered":"U.S. Oil Fund (USO)"},"content":{"rendered":"\n<p>The U.S. Oil Fund (USO) is an exchange-traded fund (ETF) designed to track the daily price movements of West Texas Intermediate (WTI) crude oil. Rather than holding physical barrels of oil, USO invests in oil futures contracts, primarily on the NYMEX, making it a proxy for crude oil prices that is accessible to retail and institutional investors alike.<\/p>\n\n\n\n<p>USO is often used by traders seeking to gain exposure to oil without trading in the more complex futures market. However, due to the nature of futures contracts\u2014especially when rolling from one contract month to the next\u2014USO can suffer from contango (when future prices are higher than spot prices), which erodes returns over time. This makes USO more suited for short-term speculation rather than long-term investment.<\/p>\n\n\n\n<p>The fund gained attention during the 2020 oil price collapse, when WTI futures briefly went negative, forcing USO to overhaul its investment strategy. It serves as a case study in commodity-based ETF risk, particularly around liquidity, volatility, and the disconnect between spot and futures prices. Despite its drawbacks, USO remains one of the most popular vehicles for oil price exposure in equity markets.<\/p>\n\n\n\n<p>Futures trading is available through IBKR&#8217;s Integrated Investment Account. Clients can trade futures and futures options across multiple market centers at competitive commission rates. Trading permissions must be requested through Client Portal, and real-time market data subscriptions are required for live pricing, though free delayed data is available.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<p>Content only applicable to IBAU, IBCAN, IBHK, IBIE, IBJP, IBSG, IBUK, IBUKL, IBLLC clients.<\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The U.S. Oil Fund (USO) is an exchange-traded fund (ETF) designed to track the daily price movements of West Texas Intermediate (WTI) crude oil. 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