If you seek fresh investment pastures, uncluttered by the proverbial herd, it's easy to see where to go right now: Europe and emerging markets.

With the troubles in Spain and Greece and the rest of the eurozone, and with the economy slowing in China and other developing countries, average investors have been scared away, and for good reason.

The herd has moved to domestic, dividend-paying stocks.

While that is clearly a comfortable move, some investors may find their best chance to increase yield and returns — and to buy high-quality assets cheap — comes from running with and against the herd, going toward dividend-paying stocks, but getting them from foreign-stock funds.

Domestic dividend-paying stocks still represent a reasonable value in the eyes of equity-oriented investors, but their popularity has started to drive down relative yields, making them less attractive to someone who not only wants the payout but who sees distribution as a form of protection against a decline.

By comparison, in Europe, Asia and the emerging markets, global economic concerns have undercut prices, making yields more attractive, at least for anyone brave enough to take the chance.

John Buckingham, manager of the Al Frank fund (VALUX) recently noted that, "The headlines are sending everyone out of Europe, and Spain and Portugal, but there are still values there, good businesses that will be functional and running and that are important to the future."

It takes a strong stomach to make the play, but some people might dig deeper and find out that antacids aren't necessary.

As investors have gotten out of foreign stock funds, for example, most financial observers have noted that buying domestic stocks does not make them immune from global markets.

After all, fill a portfolio with big blue-chip dividend-payers and you've got a portfolio of multinational companies where a large chunk of the business comes from overseas. They are not immune to the economic woes of the eurozone.

Now flip the picture, and fill a portfolio with top foreign multinationals; the big difference in some cases will be the location of the home office, or the stock exchange they're listed on.

Think of it like the difference between ExxonMobil and Royal Dutch Shell; you may find gas stations from each while driving the highway or neighborhood, and both are impacted by the same domestic and global concerns, even though one is a domestic stock and the other a foreign company.

"Cheap is another angle on risk, and right now the yields are better in the foreign dividend-paying stocks than in the domestics," said Russel Kinnel, director of fund research at Morningstar. "If you can get much-more generous yields overseas — and you are an investor who is determined to get some income — it makes sense to look there, provided you can find the values amid the risks and get past the obvious cautions."

The "obvious cautions" go beyond "Read the headlines, you'd be investing in those countries, you idiot."

For at least the remainder of the current year, domestic dividend-paying funds have a tax advantage over the treatment of distributions from foreign funds.

That reduces the benefits of the extra yield generated by foreign funds; don't step up the risk ladder if there's no real after-tax payoff to it.

Currency fluctuations can also play a role in returns, and the shaky status of some global currencies could take a bite out of the gains on foreign funds.

Before breaking from the herd, be comfortable that there is some real additional return for making the move.

Further, not all yield is created equal. It's important to know what is under the hood of any fund the fund, but particularly if the issue is taking you out of your comfort zone.

"You really need to dig down into the holdings and see how opportunistic managers have been; if you can, look at a core Europe with high allocations to the UK and Germany, or look at funds that are capitalizing on the high-dividend companies of Asia," said Matthias Kuhlmey, managing director at HighTower Advisors in New York. "You have to be very selective."

In this case, selectivity delivers comfort. If you're reaching across the pond for yield and the payout is coming mostly from financial stocks, that's a shaky distribution and a high-risk fund; the wrong choice.

"You still have to look at buying quality businesses, global companies that have a long future ahead of them at reasonable valuations, and there are some funds that expose you to the higher dividends of Europe and Asia and emerging markets but in a less-risky, more-predictable way," said Kinnel, who singled out Matthews Asia Dividend Investor and Tweedy Browne Worldwide High Dividend Yield Value as examples.

"Even in a less-risky fund, you need to realize that this is still a step up the risk scale," said Kinnel.

"The dividends will give you some downside protection, but if you're not going to be able to sleep at night if you're invested internationally, then don't even think about going there."

Chuck Jaffe is senior

columnist for MarketWatch.

He can be reached

at cjaffe@marketwatch.com

or at P.O. Box 70,

Cohasset, MA 02025-0070.