It’s no secret that China’s phenomenal growth has been driving the global recovery. China’s first-quarter GDP grew at an 11.9% annual pace despite three significant increases to reserve requirements that were designed to cool lending and growth. That’s why in much of 2009 and early 2010 I was bullish on China and overweighted my global portfolios in favor of this country. Some favorite picks of mine included Baidu (BIDU), CNOOC Ltd. (CEO), KongZhong (KONG), Netease.com (NTES) and RINO International (RINO) among others.

But all good things must come to an end and right now it’s time to get selective about which China stocks you buy. That’s why I recommend investors cut back their China holdings and look for new opportunities in emerging markets.

To be clear, there is no “China bubble.” I still actually recommend some Chinese stocks in my paid newsletters – including Baidu (BIDU) and Chinese agriculture companies Yuhe International (YUII) and Yongye International (YONG). But the B word is one of the most terrifying things Wall Street can hear, and the word has followed China’s every move of late. As a result, Chinese stocks have become quite volatile and the market has become much more selective. That means your portfolio should get selective on China stocks, too.

Again, I’m not bearish on the country, but there is reason to be cautious in this region and there’s no need to take on the risk of having a portfolio overweighted in China when there are so many other countries that are delivering solid profit opportunities. Here are a few up and coming emerging markets to watch:

Israel Stocks to Buy

The first non-U.S. country I’m targeting for market-beating gains in the year ahead is Israel. With a strong “currency tailwind” from a strong shekel and favorable exchange rates, Israel’s economy is doing well. Additionally, this nation is formally moving from emerging to established status for institutional investors, we’re at the beginning of what should be a fantastic growth run for Israel.

My top Israel stock right now is Internet Gold-Golden Lines (IGLD). This communications stock is one of Israel’s largest Internet service providers. IGLD provides Internet access to more than 960,000 home subscribers and about 90,000 business customers through its Smile.com subsidiary. The company’s other services include virtual private networking and Web hosting. Its Smile.Media subsidiary manages Internet portals and e-commerce services, while its Internet Gold International branch handles these activities outside of Israel. The stock is up more than 35% year to date, and his been a member of my Global Growth newsletter since January.

Brazil Stocks to Buy

Another booming emerging market is Latin America. In years past, investors have largely cashed in on natural resource plays or utilities, but this market is opening up as a booming middle class increases spending and more Western businesses reach out to the region. Consider that Brazil auto sales hit an all-time high in 2009 even as U.S. auto sales were collapsing. Ford Motor Co. (F) alone saw 2009 Brazil sales jump 11.35% from the previous year to 3.14 million units — a third straight annual record.

Global blue chip stocks like Ford are always a good way to play emerging markets, but if you really want to roll up your sleeves and get into Brazil I recommend Companhia de Bebidas das Americas (ABV). Translated to “the American Beverage Company,” and commonly known simply as AmBev, this stock company dominates the Brazilian beer market with brands such as Antarctica, Brahma and Skol. Additionally, the company sells Pepsi brands, Lipton iced tea and other beverages that include mineral water and sports drinks. Along with Brazil, AmBev sells its products in some 13 other countries, including the South and Central American countries of Argentina, Peru, Ecuador, Uruguay and Venezuela.

As of this writing, Louis Navellier owned BIDU, YUII, YONG, IGLD, F and ABV in personal or client portfolios.

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