By ANNA PRIOR

Play it Safe : Regional Banks

• Risk Level: 25

Investing in banks hasn't been pretty -- or safe -- recently. The KBW index of 24 large U.S. bank stocks has fallen 26 percent during the past year. But even though regional bank stocks also have lost money, analysts say they are, as a whole, much safer than many of their larger, Wall Street focused peers. Regional leaders such as Pittsburgh's PNC Financial Services Group or BB&T, based in Winston-Salem, N.C., aren't directly involved in global banking -- and considering the continuing debt problems in Europe, that's a good thing these days, analysts say. Plus, layoffs and asset sales at big U.S. banks could lead to more business and higher profits at the regionals, says Stephen Moss, equity analyst at Janney Montgomery Scott. Instead of trying to pinpoint one regional bank, investors can buy a basket of them using one of two exchange-traded funds, the SPDR S&P Regional Banking (KRE) or iShares Dow Jones U.S. Regional Banks (IAT) .

Go for Broke: European Banks

• Risk Level: 90

For aggressive investors, the best opportunity just might be the headline-grabbing European banks. Many of these across-the-pond banks now have rock-bottom stock prices. Shares of French banks BNP Paribas and Societe Generale each have fallen more than 35 percent in the past year, and as a result, each now trades at the lowest price/book ratio (a common way to compare bank stocks) it has in more than 15 years. Of course, people have run from these banks because they own debt from Greece or Italy, or both. And even seemingly "localized" crises often have unintended consequences (few thought Lehman Brothers' collapse in 2008 would nearly bring down the U.S. financial system). But if the euro debt crisis is resolved without the European Union imploding, bank shares could benefit sharply. When Europe "is fully out of the woods, financials could double," says Larry Kantor, head of research for Barclays Capital.