An explanation thatÂ´s sometimes given is the carry trade: institutions borrow money in the USD, at 0% interest and let it accumulate interest in a country with higher rates. However, I find that hard to believe. LetÂ´s say that in the best case, theres 3% to be made in a year. The dollar moves more than that in a week ! So why would anyone go for 3% if you could easily lose large multiples of that ? Any thoughts on the carry trade explanation and/or other explanations for the usd/stock market correlation ?