By holding non-dollar-denominated assets, such as emerging market equities, investors can hedge against weakness. iShares MSCI Emerging Markets (NYSEArca: EEM) is up 60.9% year-to-date. Read about what emerging markets can do for your portfolio here.
A weak dollar can also be hedged with commodity ETFs, including United States Oil (NYSEArca: USO) and iShares COMEX Gold Trust (NYSEArca: IAU). Dollar-denominated assets tend to become cheaper for overseas buyers, which often leads to a spike in prices.
For more stories on currency ETFs, visit our currency ETF category.
Read the disclaimer, Tom Lydon is a board member of Rydex Funds.
For full disclosure, Tom Lydon’s clients own shares of EEM.
Kevin Grewal contributed to this article.