Individual investors have 3 ways to take advantage of the dollar’s movements:
One is to invest a small percentage of your portfolio in a foreign exchange money market fund or currency ETF, such as FXE, which tracks the Euro. Both gain as the dollar falls again the euro. But this strategy is highly risky since your investment is resting on the performance of just one currency.
A better option is to invest in a global bond or stock fund, which will benefit if the dollar weakens worldwide. A global bond fund is likely to perform better, since the securities it holds are more sensitive to dollar swings.
A third option is to invest in the stocks of large American-owned multinational companies that receive more than half their earnings from overseas. These companies are more likely to see earnings improve as the dollar softens.