With all the upheaval in the eurozone and the promise of more to come, what's an investor to do? Kick anything vaguely European out of the 401(k)?

Baltimore money managers T. Rowe Price and Legg Mason say they both have relatively low levels of exposure to the eurozone: 4 percent of assets under management at Price, 5 percent at Legg.


But they haven't pulled back in a big way from the region, which is struggling — to varying degrees, depending on the country — with debt and fears of a sharp recession. Even as T. Rowe Price looks for ways to minimize risk from the crisis, the company's international fund managers are on the hunt for bargains in Europe.

Jason White, portfolio specialist for international equities at T. Rowe Price, said the bottom line is that investors need to account for the high likelihood of a bumpy ride and low odds of quick fixes for the 17 nations that use the euro.

"The structural issues that are facing Europe are going to play out over the next decade, potentially — or longer," he said. "Understand your risk tolerance and appetite for that volatility."

Europe's ripple effects are splashing even those invested strictly on this side of the Atlantic.

Last week, pessimism about a European Union summit meeting on Thursday and Friday bled into U.S. indices — until European leaders announced a plan to rescue banks and relieve debt-burdened governments.

News of the deal in Europe broke overnight, and on Friday, stocks soared. The Dow Jones industrial average closed up 277.83 points, its second-biggest gain this year. The Standard & Poor's 500 index also rose significantly.

For investors trying to find value in Europe, geography matters. Greece, Ireland and Portugal, choked by government deficits and weak economies, have all required bailouts in the last few years. Other countries, especially Germany, look much stronger by comparison — though they're not exempt from the turmoil.

U.S. financial institutions are among those altering their portfolios with geographic considerations in mind. Hamilton Place Strategies' most recent report on the state of domestic financial services, released in February, shows changes in both directions.

Banks here reduced their exposure in weak eurozone countries — notably Greece and Spain — between spring and summer of last year while increasing it in Germany and a few other EU countries, Hamilton Place Strategies said.

Mary Athridge, a spokeswoman for Legg Mason, said the company's eurozone-exposed assets under management aren't spread equally across the region, either.

"A lot of that is concentrated in places like Germany," she said. "People have been aware that there have been issues for a while and have been hedging their portfolios accordingly."

And Brian Lewbart, a spokesman for T. Rowe Price, said the money manager's investment tally in the eurozone is "marginally lower than it has been previously, generally due to reducing exposure in the European periphery countries."

"T. Rowe Price has taken a number of steps to mitigate risk and minimize the exposures in its funds and client portfolios to those European countries, counterparties, or assets we consider most at risk," he added in an email. "A limited number of funds and portfolios have such exposure."

The eurozone is certainly on fund managers' minds — it was a popular topic of conversation at Morningstar's investment conference in Chicago just over a week ago.


"They've been spending a lot of time thinking about whether this is a crisis or an opportunity, and that will play out in different ways in different portfolios," said Laura Lutton, a director in fund research at Morningstar, a mutual-fund tracker.

T. Rowe Price fund managers who concentrate on international equities fall into the opportunity group — they see an opening for profits. The company's strategy on stocks is to try to get past the noise about what might happen in Europe and zero in on individual companies.

"Every crisis creates opportunity," said White, who works with Price's Overseas Stock Fund and International Stock Fund. "Valuations in Europe are in many cases as cheap as they've been, certainly in recent history."

The funds have targeted stocks such as food producer Nestle and Richemont, maker of high-end jewelry and watches. Both companies are based in Switzerland — which is not a eurozone country or a member of the 27-member European Union — but do business internationally.

Nestle isn't "heavily exposed to the issues within Europe" thanks to its geographic diversification, White said. And Richemont, best known for its Cartier brand, is less exposed than it appears, he added. Though a sizable share of its sales are made in Europe, "a majority of the buyers are travelers from emerging markets," he said.

White pointed out that there are "some world-class companies in Europe. People lose sight of that."

On the fixed-income side, T. Rowe Price prefers strong balance sheets to weak — which means "overweighting" governments like Germany. And managers attempt to focus on fundamentals rather than market gyrations.

Kenneth Orchard, a fixed-credit analyst at the company, said the market cycles through hope, disappointment and despair when it comes to the eurozone — over and over.

"We try and look through the different phases of the cycle and not get too caught up in the moment," Orchard said.

Christopher Brown, president of Ivy League Financial Advisors in Rockville, which manages portfolios for middle- and upper-income clients, doesn't think "bailing out of Europe" is the answer for small investors. Money that investors need access to soon ought to be in less volatile investments than the money they're saving for the long haul, he said — but he tells clients that he sees value in Europe.

In any case, if investors hope to completely avoid fallout from eurozone travails, there aren't a lot of options.

"We're in a global economy, and if it affects one section, it's going to affect the rest of the world," Brown said.

Associated Press business reporter Daniel Wagner contributed to this article.