Precious few countries have escaped the wave of selling that has swept through global markets this year and those fortunate enough to have done so are generally quite small, showing that this year there is almost nowhere for investors to hide.

The Canadian, Brazilian and Mexican markets had been holdouts but they too have now sunk into negative territory year to date. The S&P/TSX composite index is now down 4.5 per cent so far in 2008, having crossed the line from positive to negative this latest time on July 7. Brazil's Bovespa stock index made that same move at the beginning of July. That week, the Bovespa plummeted 7.7 per cent. That index, which as recently as late may had been setting record after record aided by the upgrading of the country's credit rating to investment grade, now is down 10.1 per cent year to date. Profit-taking in the cyclical, increased risk aversion, and fears of global stagflation and interest rates have all factored into the decline.

Weighed down by sagging stock prices for two of its biggest components, Wal-Mart de Mexico SAB and wireless firm America Movil SAB, Mexico's Bolsa index dropped into negative territory in the third week of June. The two stocks account for almost a third of the index. The fact that Mexico sends about 80 per cent of its exports to the U.S. hasn't helped the situation either, given the problems in the U.S. economy. The selloff has continued since then, leaving the index 9 per cent below the level at which it started the year.

Mind you, those declines are modest when viewed against the backdrop of global markets, a number of which are officially in bear country. Europe has a number of examples of the latter, including France's CAC 40 index, Germany's DAX index and Italy's S&P/MIB index. A market is considered to be in bear territory if it has fallen 20 per cent or more from its peak. The aforementioned markets have fallen more than that since the year began. They are even further off their peaks.

There are of course other members of that unfortunate club, too. China is likely the one that pops into most investors' heads first, given the media attention to that nation's market. But its year-to-date decline of 44.7 per cent, while certainly eye-catching, actually pales by comparison with Vietnam's Ho Chi Minh stock index's 53-per-cent plunge.

A whole host of problems have contributed to the sorry state of affairs in the Vietnamese market, not the least of which is an inflation rate that hit 27 per cent in July, a figure that likely only reflects a small part of this week's fall in fuel prices. The news will, it is expected, prompt yet another tightening of interest rates. Rates have already been boosted three times this year and now stand at 21 per cent.

So which countries have been able to buck the trend in the markets? Venezuela and Costa Rica are among the lucky ones; so too are a cluster of countries in Africa and the Middle East. Lebanon's Blom stock index for example has gained almost 35 per cent so far this year, Tunisia's SE Tunindex has advanced 15.6 per cent and Qatar's DSH 20 index is up just shy of 23 per cent.

Some of those markets are quite small; the BCT Corp. Costa Rica stock market index for example has just six members. Liquidity can be a concern with some of the smaller markets.

The breadth of the weakness in global markets has made life difficult for investors. But Lisa Myers, lead manager of the Templeton Growth Fund, says history shows that the most successful investors are those who take advantage of times of maximum pessimism such as we have now to buy and they sell at times of maximum optimism.

She looks for value almost everywhere - in the U.S., in Europe and even in countries like India. Europe is the cheapest in terms of price/earnings, price-to-book value and dividend yields, but she focuses on stock picking, not individual markets.

The exceptions to her view of attractive valuations are the commodity-based economies such as Canada or Brazil.

Ms. Myers says investors need to be patient and take a long-term view and seek out great companies with good brands, great global strategies, good management teams, high free cash flow yields and good balance sheets that don't need to access the credit markets to continue growing.