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Investors looking to play the weakening dollar might consider the metals group.

While a slide in the dollar has some negative ramifications for the overall stock market, a number of individual companies -- particularly those that export heavily overseas -- are likely to prosper.

In a research note Tuesday, Goldman Sachs analyst Alberto Arias said one of the big beneficiaries should be the metals group.

"The predominantly export-nature of the mining industry makes profit margins inversely correlated to local currency trends," he said. "Over the past years, local currency devaluations have benefited major mining regions such as Australia, South Africa, and Brazil."

The dollar has fallen against the yen and euro this week after the Group of Seven industrialized nations called on China and Japan to let the market forces determine their foreign exchange rates. Japan has been intervening to prop up the yen in order to help its exports, which account for about 10% of the country's gross domestic product. China's currency, the yuan, is pegged to the dollar.

Arias expects gold stocks to benefit from an increase in gold prices. When the dollar falls, gold often rises because investors lose confidence in paper currency.

"We believe gold prices could reach $400 an ounce in the near term. However, the recent strong appreciation of gold equities leaves only a 6% upside in the XAU gold index," he said. "We recommend investors to buy selectively on weakness."

Arias recommends

Phelps Dodge

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and

Newmont Mining

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. He also believes

Alcoa

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should do well, noting that demand will increase for base metals produced in the U.S. That, in turn, should raise prices.

"A weakening U.S. dollar should improve the relative competitiveness of base metal and gold companies with operating assets in the U.S.," he said.