My pulse oximeter displays both the heart rate and O2 saturation. Heart rate readings are useful enough. But what about O2 saturation? I'm thinking of cycling in particular, but I assume any benefits would translate easily to any kind of physical exercise.
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O2 Saturation can, for the most part, be ignored.
If your O2 Saturation levels are low, then your lungs are not getting enough oxygen to your blood.
That said, if you notice your Oxygen Saturation Levels dropping during a workout, you should seriously consider sitting down a moment to let your body recover or step outside to get some fresh air.
There could be people with medical conditions that need to monitor their blood's Oxygen levels, but for the most part this is not anything you are going to control on your own.
Blood oxygen saturation will go down slowly as exercise intensity goes up, then probably drop quickly to around or below 90% when you exceed maximum O2 intake (i.e. you can't breath any harder). At low spO2 values you will rapidly reach exhaustion. You can find articles on the subject on Livestrong or 3fatchicks.
The problem with LED-based oximeters is that they tend to not deal very well with motion artefacts. So during exercise you may end up with bad readings, held-up values or no value at all.
Heart rate tends to be easier to use as a physiological parameter when monitoring effort level.