But currency ETFs are also attractive to long-term investors, he says. "We consider currencies as a separate asset class from stocks and bonds," said Zaro. "They're categorized in our portfolios as true alternative investments."

Currency ETFs as a whole make up about 5% of the firm's long-term-oriented portfolios. Some more aggressive traders prefer to use up to 10% of their total assets in various currency ETFs.

Besides FXE, Zaro also is investing in CurrencyShares Australian Dollar Trust (NYSE: FXA) and CurrencyShares Swiss Franc Trust (NYSE: FXF). Both also have been on a run lately.

"Fundamentally, you can also make a strong argument that the Aussie dollar with its base in natural resources is likely to keep experiencing strong growth," Zaro said. "We also think that the Swiss economy is a fairly stable economy and has sound money policies that should hold up well in the future."

Roger Nusbaum has been investing in currency ETFs since their debut some two years ago. The portfolio manager at Your Source Financial in Phoenix, Ariz., is cutting back in the firm's stake in FXE, though.

He bought FXE last fall at around $141 per share. Nusbaum sold it this week at $149.66 on the current spike. "Similar to oil and other currencies, typically when you see a big move like this, you see speculators coming out of the woodwork," he said.

Nusbaum says over the next few months, FXE could have already peaked. "But we didn't completely give up on the theme of a weaker dollar," he added. "It was more of a trimming."

As the spotlight shines brighter on the euro, he's holding on to two-year notes bought directly in some less-known foreign markets. Those include short-term paper from Norway, Australia and the U.K.  

"We're lightening up a little on the euro," Nusbaum said. "The big picture, though, is that the dollar will probably continue to show weakness. But in the short run, it's plausible that the U.S. dollar will have a snap-back rally."

Investors without exposure to currencies need to balance current conditions with longer-term objectives, he says. "Trading on short-term movements in currency is not something I'd suggest," Nusbaum said. "We've been in them for a relatively long time now. I'm just trying to protect those profits."

But for someone with no exposure to currencies and considering adding this asset class to their long-term asset allocation plan, he advises taking a slow-but-steady approach. "At this point in the run-up in foreign currencies, it might be better to wade into the market now," Nusbaum said. "If your allocation calls for 5% in currencies, perhaps start by investing 2% of that now."

He tells financial advisors working for the firm that currency ETFs should be viewed as a different sort of investment than stocks or most fixed-income funds.

"If you're going very short in bonds, there's probably not a lot of difference between owning bonds and currency ETFs," Nusbaum said. "But if you're buying something because it looks like interest rates are going up, then currency ETFs provide you with more of a chance to directly benefit from that movement."

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