A high-net-worth client of Peter S. Izzo, a wealth adviser with Merrill Lynch, recently came to him seeking to allocate a small percentage of his portfolio to emerging markets. The client, a retiree in his fifties who once ran a public company, wanted to select four or five countries with the best potential return.

Izzo turned to Merrill's research department to select countries it thought would be the best performers over the next 12 months. "After the Asian crisis of 1998, people would think you were crazy" to consider emerging markets, Izzo said. "But in today's global environment, for a client who is more aggressive in terms of risk tolerance, that makes sense."

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