| Understanding the forex market is important to day | | | | money trading online. In the past the ability to take |
| trading success. Given the vast amounts of money | | | | advantage of small differences in stock prices was |
| that move in the foreign currency markets it only | | | | limited to people with large amounts of capital and |
| makes sense that currency movements have a | | | | teams of traders ana analysts at their disposal. Not |
| major impact on stock prices. Day trading on any | | | | so anymore. The invention of options, ETFs, and |
| exchange successfully therefore requires at least a | | | | mini-forex accounts has opened the door to a much |
| rudimentary understanding of how the forex market | | | | smaller capitalized investor. Traders with even a |
| impacts asset prices. | | | | modest $100.00 can take advantage of small |
| How the USD Forex Market Impacts the S&P 500 | | | | inequalities an still generate profits justifying the |
| It has long been established that the USD forex | | | | effort. |
| market has an inverse relationship with the S&P 500. | | | | How the Modern Small Capital Investor Trades |
| Investors ignore this high correlation at their own | | | | Profitably |
| peril. An inverse relationship implies that as the USD | | | | One of the ways smaller traders invest profitably is |
| grows stronger against other major global currencies | | | | by taking advantage of tiny option contracts called |
| the S&P 500 falls. Conversely the reverse is typically | | | | binary options. The fascinating thing about these |
| also true, that as the US Dollar falls, the major | | | | securities is that there is no transaction costs |
| American stock market indices will rise. | | | | (allowing no-cost trading) and extremely high fixed |
| Taking Advantage of Tight Relationships Has Become | | | | yields - ranging from 58-80% on most contracts. This |
| Easier for Retail Investors | | | | allows a trader with a few dollars to take advantage |
| One of the great advantages of having some | | | | of small swings in price and still earn yields comparable |
| knowledge about the nature of money and stock | | | | to highly leveraged forex market traders. |
| prices is the ability to use that knowledge to make | | | | |