Although the first quarter might have been a good one for U.S. stocks, with the SPDR S&P 500 ETF (NYSE:SPY) gaining more than 10% since the end of 2012, the same can’t be said of emerging-market stocks. The average emerging market equity lost more than 3% last quarter — a distinct reversal of fortune from 2012, when emerging-market names kept pace with the broad U.S. market’s 13.5% advance.

Yet, it wouldn’t be accurate to say every emerging market struggled last quarter. A handful of them did exceedingly well, for all the right reasons.

Here’s a closer look at Q1’s best and worst overseas markets, why they did so well and so poorly, and what investors might expect going forward.

Top Dogs

Just to put things in perspective, last quarter was the worst Q1 for emerging markets since 2008’s first quarter. So, for any of these groups to make bullish progress at all since the end of 2012 is an enormously big deal.

Of course, it’s not like these big winners didn’t deserve their gains. Take the Philippines, for example. The country was granted its first-ever investment-grade debt rating, spurring its stocks and the iShares MSCI Philippines Investable Fund (NYSE:EPHE) to record highs.

It’s not just higher-caliber debt that has drawn investors to the country, though. The nation is seeing tremendous growth thanks to a mix of growing consumerism as well as rising exports. In the fourth quarter, the Philippines’ GDP grew at a rate of 6.8%. It’s also seeing a boom in hotel building, largely to accommodate its budding casino business.

Another off-the-beaten-path country investors may want to mull is Panama. There’s no country-specific ETF, and only a handful of Panamanian ADRs. But, it still might be worth some digging, if only in admiration of the fact that the country refuses to issue any new debt despite its need for funding.

But how will it grow its way out of a hole? Well, it might not be in a hole to begin with. Panama’s economic growth is forecast to be 8.5% this year, which would make it the Latin American growth leader for a third straight year. Throw in the fact that $5.2 billion is being spent to expand the Panama Canal, and the country is positioned to make itself something of a global-trade hub by 2015, when the work is expected to be completed.

Bottom Dwellers

Though a handful of areas saw their stocks make gains in Q1, there were still more losers, and the losses were bigger than the few gains we saw from emerging markets.

South Africa was one of the hardest hit in the first quarter. The iShares MSCI South Africa Index ETF (NYSE:EZA) lost more than 9% of its value since the end of last year.

There’s more than one reason for the weakness, although the biggest one was the broad realization that the country is simply in no condition to be a strong competitor in the global economy. Imports into South Africa have growing by 25% since 2011, but exports are only up 13% during that time. It’s not a situation that creates economic progress.

That’s not the worst of South Africa’s brewing trouble, however. The country’s credit/debt situation has drastically deteriorated lately, accompanied by an 8.2% plunge in the value of South Africa’s currency so far this year. The country’s account deficit of 6.5% of its GDP is as high as it’s been since 2009. While its higher bond yields were once compelling, even investors who were previously willing to take on higher risk for higher yields have now become plenty nervous.

Another big loser, Peru, is seeing currency problems of its own. In fact, the sol fell more in the first quarter than it had in any quarter since 2008, with no end to the decline in sight. The plunge is the result of the country’s central bank decision to raise its reserve requirement to curb dollar inflows. While not directly a damper on the country’s market, a weak currency broadly stifles a willingness to invest in the country. And that weakness has also led to a 2% loss in the value of the iShares MSCI All Peru Capped Index Fund (NYSE:EPU) over the course of the quarter.

The Last Word

In the grand scheme of things, last quarter wasn’t all that different than most quarters when it comes to emerging markets — some did well, and some did poorly. But, to make the most of these disparities, traders still need to pick and choose carefully.

The key to the difference between strength and weakness, right now anyway, seems to be smart management of currencies.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities.