As the Fool's resident fund analyst, I spend an inordinate amount of time thinking about asset allocation and about the performance of the market's various asset classes. With respect to the former, I firmly believe that -- while you may have loads of fun snagging a few triple-baggers along the way -- it's ultimately smart asset-allocation decisions that will get the market-beating job done over the course of an investing life.

On the latter front, my interest is all too easy to explain: I'm as curious as the next market geek about what's working now -- and what isn't.

Come sail away
One asset class that's been working quite well over the past several years is international equities. For example, for the three years that ended this past February, the MSCI EAFE -- a foreign equity benchmark with top holdings that recently included BP (NYSE:BP), Toyota (NYSE:TM), GlaxoSmithKline (NYSE:GSK), and Vodafone (NYSE:VOD) -- has posted an annualized return of roughly 28.9%. Over that same stretch of time, the S&P 500 has managed just 16.8%.

Now, contrarian that I am, that differential would typically compel me to look askance at the EAFE and cozy up to the 500. Except for one thing: I already have plenty of domestic exposure. My hunch is that you do, too, so it's a good thing that there are still plenty of international bargains to be found, if you know where to look.

Where to look?
That's an excellent question and one that, not coincidentally, our brand-spanking new The Motley Fool International Stock Report: Around the World in 80 Minutes is designed to answer.

The report features 14 recommendations from our Foolish writers -- a pair of fund picks from yours truly included. One of those is a long-haul outperformer with a portfolio that provides exposure to emerging-markets stocks as well as foreign stalwarts. And this fund, moreover, is a choice pick for folks who don't want to rush headlong into international waters. To wit: U.S. concerns such as ConocoPhillips (NYSE:COP), Costco (NASDAQ:COST), and Gilead Sciences (NASDAQ:GILD) give its portfolio a domestic hedge.

The vast majority of us need at least some measure of exposure to international equities. With, say, 20% of your hard-earned moola allocated to foreign affairs, you can help insulate your portfolio when the domestic market hits the skids -- all while availing yourself of gains to be had abroad. Indeed, for the 10 years that ended this past February, the fund I described above has spanked the S&P, posting a total return of more than 200% while the 500 notched a relatively paltry 135%.

In a sense, then, international investing is a twofer -- a tack that allows savvy types to secure potentially greater returns and, simultaneously, a hedge against domestic-market performance gyrations. Sound like a winning combination to you? If so, I encourage you to snag a copy of Around the World in 80 Minutes and see what you think. A world of Foolish investment ideas is just a mouse click away.

Shannon Zimmerman doesn't own any of the securities listed. GlaxoSmithKline is an Income Investor recommendation, Vodafone is an Inside Value recommendation, and Costco is a Stock Advisor recommendation. The Fool is investors writing for investors, and you can read all about our disclosure policy by clicking right here.