"You can't avoid it," says World Currency Watch managing editor, Kat von Rohr. "You can't take a break from investing in it. You can't sell everything and run like hell if the markets turn against you."

"No matter what, you'll still end up with some kind of cash in your pocket (unless you plan to live a life of poverty). So you'll technically have some kind of investment in this market - even if you never place a single Forex trade in your life. "
"In fact, you probably have even more currency investments than you think: Your house, any capital in your business, bank accounts, all your investment portfolios, your IRA, your trust funds for your kids - all technically currency investments because you can sell them for cash."

"And if you're starting out in the currency markets, you probably have all those assets dominated in just one currency - dollars."

"If you fall into that category, I urge you to spread your bets a bit this year. I know what you're thinking; sure, ‘diversify' - I've heard that before." But honestly, it's more than that. Very few investors think about the effect one currency can have on their overall wealth."

"For instance, the dollar dropped just over 40% from 2002 to mid-2008. That means your dollar assets depreciated and also fell 40% in value. And even with the dollar rallying recently, it's still not the best idea to wager your entire net worth on the dollar's continued performance. "

Kat goes on to explain the solution..."Of course, if you are interested in diversifying, it's not as easy to purchase real estate in a foreign currency (unless you're buying property abroad). But it's a simple matter to buy a few currency ETFs with your IRA. ETFs are sold right on the NYSE and the AMEX, so you should be able to buy them as easily as any stock."

"In the same way, a foreign currency CD can pad your dollar-denominated bank accounts. Our friends at EverBank have a wide variety of them. Each CD is FDIC insured, in case the bank should ever go insolvent. You can learn more about them at www.everbank.com."

"Remember: You're already a currency investor - so you may as well hedge your currency portfolio while you can."