What NOT to Do with Your Investments

You may hear a variety of strategies to profit from a weak dollar. As always, some are good, some are not. Let's start with what NOT to do.

The purest play on currency movements is actually owning other currencies. Some pros are successful at profiting from the differences in value among currencies, but we do not recommend this for anyone except the pros.

Don't fall prey to those "anyone can do it" infomercials on television touting the ease of currency trading.

Also...beware of "proprietary" software touting the ease of currency trading! Many "systems' just don't work!

If it's so easy, why don't the purveyors of these programs simply trade currencies themselves with their software programs, make the "killing" they tell you is so easy and retire to a nice beach with their millions?

Some people are also suggesting that you avoid the U.S. market and invest overseas.
Investing overseas can be trickier than investing here at home. There is the currency risk of the country in which you are investing, the risk that the U.S. dollar could reverse course, and the risk that the foreign company could lose share value.

Most important, it's often extremely difficult to get detailed research information on many overseas-based firms. In many foreign countries, it's easier for companies to hide their shenanigans from shareholders. Proceed only if you have the time to do your research and experience investing abroad.

Commodities, especially precious metals, are another area investors traditionally turn to when the dollar is weak as a hedge against inflation. This is also an area that we usually recommend for the pros and VERY experienced investors only.

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