• Investing in foreign currency can allow you to diversify your portfolio and make money even if the value of the dollar decreases. You can invest in foreign currency directly by opening a foreign CD or by opening an account with a Forex broker. You could also invest indirectly by investing in foreign stocks or through exchange-traded funds (ETFs).
  
  

Forex Trading

• One of the most direct ways to invest in foreign currencies is to open an account with a Forex broker and directly trade currencies. During every transaction, you will buy one currency and sell another. This type of trading is very volatile and is not for those without experience. Try Forex trading before you risk real money by using a demo account.
  
  

Foreign CDs

• Another way for you to invest in foreign currencies is to buy a foreign CD. This is similar to the certificates of deposit that you can buy domestically, but foreign CDs are not insured by the FDIC. With this type of investment, you get a guaranteed rate of return that is generated by returns from stocks and other investments. This is a simple way to invest in foreign currencies, and you do not have to have any prior experience in this type of investment to be successful.
  
  

ETFs

• An ETF is similar to a mutual fund, except you can buy and sell shares on a stock exchange. You can buy shares in a foreign currency ETF to gain exposure to that particular currency. You could buy Euro ETFs, or ETFs based on many other foreign currencies. This allows you to take advantage of professional money management because a fund manager is in charge of making all of the investment decisions for the ETF.
  
  

Stocks

• An indirect way to invest in foreign currencies is to buy stock in foreign corporations. You could also buy stock in domestic companies that have a large international presence. By purchasing stock in these companies, you can often take advantage of the profits that are generated from the positive exchange rates when their money comes back into the country. If you invest in a foreign company, you could also benefit from having your investment in foreign dollars when you bring in dividends and when you sell your stock.