If you are looking for that extra edge for your portfolio, you need to add foreign stocks. While stocks in the U.S. are faring well so far in 2011, you need to also watch for stocks in the emerging markets. Based on my economic analysis, one of my favorite regions for long-term growth continues to be China.

Yes, there are issues with Chinese reverse merger stocks at this time, but these cases do not represent the enormous opportunities in China for higher returns.

The Shanghai Composite Index (SCI) is up 7.66% this year as of Tuesday, above the comparative gains of the NASDAQ, DOW, Russell 200, and S&P 500.

And if you extrapolate going forward, you’d understand that the real growth is in the emerging markets.

In the U.S., the International Monetary Fund (IMF) cut the U.S. gross domestic product (GDP) estimate to 2.8% for 2011, down from three percent, blaming the country’s housing and jobs issues.

Growth in the advanced economies is predicted at 2.4% in 2010 and 2.6% in 2011, according to the IMF. Compare this to the estimated 6.5% growth in the emerging markets in 2011 and 2012.

Outside of the U.S., I like the BRIC countries, comprised of Brazil, Russia, India, and China. China’s GDP growth is estimated at 9.6% for this year, while India’s is at 8.2%. Russia is estimated to grow its GDP by 4.8% this year and Brazil by 4.5%.

As I said, China is my top area for growth. China has overtaken Japan as the world’s second largest economy and, in about 15 to 20 years, China is expected by pundits to become the world’s largest economy. Investment bank Goldman Sachs predicts that China will become the largest economy by 2040.

In Asia, it has become a tale of two cities of sorts. Japan reported a 0.3% decline in its fourth-quarter GDP; whereas China reported 9.8% growth in its fourth-quarter GDP. Japan continues to be impacted by decades of stagnant growth. In fact, from 1980 to 2010, Japan’s average GDP growth was a miniscule 0.55%, versus an average of 9.3% annually from 1989 to 2010 for China. So, while Japan has faltered over the past three decades, China has used the opportunity to put its massive cheap labor workforce to use and create a colossal manufacturing capacity for cheap labor and lower cost to produce goods.

Also take a look at the smaller Asian countries, such as Malaysia, Indonesia, Korea, and Taiwan.

One region of concern in my view will be Europe where, as you know, there is muted growth and rising debt and deficit levels in Greece, Spain, Portugal, Ireland, Italy, and Belgium. If not for capital…