Bet Against the Dollar

Physician's Money Digest, April15 2004, Volume 11, Issue 7

Because of the enormous tradedeficit that has been building, the dollar'svalue has been falling steadilyagainst the euro and other foreign currencies.Investment legend WarrenBuffett believes the dollar will continueto decline over the next few years. Thesavvy physician-investor can capitalizeon the dwindling dollar by buying foreignstocks or investing in a companythat depends heavily on exports as asource of income (eg, Procter &Gamble, Coke, DuPont, etc). Anotheroption is to open an account with a firmthat specializes in currency trading.Some of the big players include ForexCapital Markets, Saxo Bank, and CMCGroup. Another less risky tactic is tobuy a CD denominated in foreign currenciesfrom a company such as Everbank.A physician-investor could alsoopen an international bond fund thatbenefits from the dollar dip. Some reputablefunds to consider include AmericanCentury International Bond (BEGBX)and T. Rowe Price International Bond(RPIBX).