However, emerging markets funds have been in decline for so long there are whisperings that some are finally beginning to look good value and a reasonable long-term investment opportunity. At least, that is what Mark Howard, a financial adviser with Maddison Monetary Management believes is happening.
They key, he says, is to pick the right country. That's backed up by the performance figures which show that single-country emerging markets funds, such as the Israel Fund or Fleming Indian, which invests in the Indian sub-continent, are doing better than funds offering a spread of investments in a range of countries and areas.
The latter are pulled back by the worst performing countries, such as Russia, which for a variety of political and economic reasons are really doing very badly. But looking more closely at some of these so-called emerging markets reveals some potential gems.
Mark Howard favours China. "They're building the right infrastructure required for the next millennium," he says. "It's not a coincidence that Blair visited the country recently, despite their poor human rights record - it's a pointer that they're getting it right there. They're starting to relax their attitude to the West." He argues that China is an area where investors can look to long term growth, over five to 10 years, and not short term gains. "You're looking at a market with huge potential," he says.
Radhika Ajmera, head of emerging markets at Aberdeen Asset Managers, looks elsewhere. "In Israel you can buy First World companies at Third World prices," she says, and believes the country is well worth investing in.
Staying in the same region, she highlights Egypt. "It has proved to be a relatively safe haven in turbulent times," she says. "Macro fundamentals remain solid, and the stock market shows little correlation with major markets."
The essential tactic for anyone thinking of investing in an emerging market is to get informed. After all, these are fragile economies we're talking about, and such fragility is very easily broken. Take Russia, for instance. Almost exactly a year ago, the fund management group, Save & Prosper, trumpeted its New Europe Fund with an expensive launch - even taking the trouble to ferry a bunch of personal finance journalists to Russia in an attempt to buy some cheap coverage. The fund invests solely in the emerging markets of Central and Eastern Europe, with most of the cash divided equally between Russia, Poland and Hungary.
According to Save & Prosper, there were compelling reasons to invest in Eastern Europe 12 months ago. The economic conditions were ideal for growth, with inflation falling, a steady increase in consumer activity, an increasingly stable economic management, and massive underdeveloped natural resources. The basic sub text was "Hurry hurry - and get in while you can!"
Anyone fooled by the hype back then will sadly not be eating caviar and sipping specially-imported vodka today. The fund has been a complete disaster, is currently bottom out of 131 in its sector, and showing a deficit of around 35 per cent. Anyone putting in pounds 1,000 into the fund a year ago would now be sitting on just pounds 648.
Even today, Radhika Ajmera warns against investing in Russia. "Extreme caution is required until the political situation becomes clear," she says. Basically, anyone thinking of investing in Russia should look to hold off until, at least, Boris Yeltsin has finally relinquished his shaky hold on the country's leadership.
But the experience in Russia points out the very problems of investing in emerging markets. Young economies are very prone to feeling the effects of internal politics. To be fair to Save & Prosper, the group did warn that there would be some short-term volatility in Russia, and even they would have found it difficult to predict the scale of the financial crisis which has hit the country. But that is why you should approach any potential emerging markets investment opportunity with caution. Are you tempted by Turkey, for instance? Think again - the country is due for elections next April, which could then lead to a fresh frenzy of political uncertainty.
Or maybe Brazil has caught your eye as ripe for growth? That's a hardy perennial. Brazil has been on the threshold of recovery for the better part of a decade, yet things seem to keep on getting worse. Despite the fact that valuations in the region are currently trading at historic discounts, experts believe that there is still a rollercoaster ride to come.
This is why emerging markets are better suited for the younger investor, in his or her thirties or forties for instance. Long term with these funds really does mean 10 years or more and investors need to avoid panicking if they want to benefit from the potential that some markets promise. The nervous should not apply.