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I always laugh when I thumb through my copy of John Spooner's classic, "Do You Want to Make Money or Would You Rather Fool Around?"

Well, I sometimes think to myself, Why not fool around a little bit? This is only money we're talking about -- not infidelity.

I found myself reviewing the performance of some of these emerging markets funds and country-specific funds that were up as much as 50 percent last year -- doubling in value during the past three years.

I found myself longing to have just a few of those little jewels in my portfolio. In short, I was feeling the urge to fool around.

After all, what harm could it do if it involved just a small amount of my portfolio?

I recalled the thrill back in 1998 of buying some Softbank stock (a Japanese company that owned a third of Yahoo) and watching it soar upward by almost eight times what I paid for it before settling in finally at one-third of my original investment.

The speed with which that all happened was just exhilarating. This time it's different. I plan to be more analytical.

Beginning with a quick lesson in calculating a "weighted average return," I will assume that I have a $100 portfolio and that $5 will be invested in an aggressive fund or combination of funds.

If the $5 doubles in value in a two-year period, I will have $5 of earnings.

If the remaining $95 invested conservatively averages 10 percent per year for two years, that portion will earn $9.50 per year for a total of $19. On the entire portfolio, I have earned $24 in two years.

This works out to be $12 per year, or a 12 percent average annual return. (I have ignored compounding because the time is so short.)

Some would argue that investing only 5 percent of a portfolio aggressively is not enough to "move the needle," but this simple example shows that it can be worth it when the high-risk investment is successful.

On the flip side, what happens if the high risk investment on 5 percent of our money drops by 50 percent in two years?

On $5, we just lost $2.50, or $1.25 per year. On the remaining $95 we still made $19, or $9.50 per year. Our total annual earnings on the entire $100 works out to be $8.25 -- or 8.25 percent. We haven't lost everything. We just had two years where our return was about 2 percent less than it otherwise would have been. Overseas funds of all types are being swamped with new money.

The pace of this capital flight has been picking up steadily, and last month's report of net inflows to foreign funds was one of the greatest ever. Most reasons are obvious and related to a growing global economy, but other reasons are not so obvious.

As just one example, the improved policing of foreign stock markets has inspired confidence that did not exist just 10 years ago.

So who are we going to call? Unfortunately, Vanguard's International Explorer has been closed to new investors since August 2004, but its returns for the past four years have been 57 percent, 31 percent, 20 percent and 30 percent.

T. Rowe Price Emerging Markets Stock has generated a comparable 52 percent, 26 percent, 38 percent and 32 percent.

Fidelity International Small Cap offers 80 percent, 29 percent, 29 percent and 14 percent. Finally, T. Rowe Price Latin America has done 58 percent, 38 percent, 60 percent and 51 percent.

See what I mean? The major risk is that the horse may be out of the barn with these funds and we could find ourselves committing the classic mistake of the amateur investor -- chasing last year's best performing fund.

I remember in the early 1990s when Montgomery Securities Emerging Markets fund was up 54 percent in a single year. Everyone had to have it, but we missed out on what had been a one-trick pony.

As for me, this time around I like the sound of T. Rowe Price Emerging Markets with a small proportion of money, because I'm fleshing out my overseas emphasis and investing for the long term. What I feel are compelling reasons for continued success in this fund category will be enough to move the needle -- hopefully in a positive direction.

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