(FORTUNE Magazine) – Vietnam and Cuba may be on opposite sides of the globe, but these days they send tingles up the spine of the same sorts of people: financiers, investors, and entrepreneurs who peruse cutting-edge emerging markets to find tomorrow's opportunities at today's bargain prices. Cuba is still as foreboding as its nickel-infused mountains, and Vietnam can be as tricky to navigate as its fish-rich shoreline. One money manager, a veteran in emerging markets, referred only half-jokingly to Cuba and Vietnam as "still submerged."

But if you are willing to take risks for long-term gains, take a look at these places, both of which are enjoying upticks in their economies. Cuba's official numbers indicate gross internal product rose 0.7% in 1994-after a calamitous collapse between 1989 and 1993--thanks in part to a 13% increase in tourism. Vietnam's outlook is even better, largely because of foreign investment. GNP saw real growth of 8.8% in 1994, to $15.4 billion, and should expand by 9.5% this year and 10% in 1996. In a move toward the capital markets that could be its watershed, Vietnam raised $7.8 million in its first treasury bills auction in June.

In Cuba, Castro recently agreed to allow 100% foreign ownership of business on his island, though that does little for Americans, who are still barred by their government from investing there. The alternative: Find who's poised to descend on Cuba once the U.S. lifts its embargo. There will be a long wait before you'll see Cuba-related movement in stock prices. But your investment choices include the Herzfeld Caribbean Basin and Americas Growth closed-end funds, both in Florida. Herzfeld has positions in Florida East Coast Industries, a transportation company that plans to operate a rail barge between Florida and Cuba, and Royal Caribbean Cruises and Carnival lines, which will ply the tourist trade.

The Cuban American business community in South Florida is sure to be first ashore when Castro goes, and will need financing from U.S. banks. Richard Bove, an analyst with Raymond James in St. Petersburg, says First Union and Barnett Banks have built strong relationships with Cuban Americans in Florida and will profit from Cuba-U.S. business via foreign exchange and letters of credit.

Cuba arguably has the world's largest supply of nickel, and it's close to the surface, making it inexpensive to mine. Consider Sherritt, a natural-resources company that trades on the Toronto stock exchange, as one way to tap into this resource. The company has a fifty-fifty joint venture with Cuba's General Nickel Co. SA. Afraid this sort of indirect investment might step on Uncle Sam's toes? You're allowed to invest in third-country companies with international holdings that might include Cuba as long as the Treasury Department doesn't think you control the company.

If Vietnam is more your style, try Beta Funds, a successful London boutique. Its Beta Mekhong is far-flung, with about $25 million to spread among Vietnam, Myanmar, Laos, Cambodia, and the Yunnan region of China. Beta Viet Nam, which has almost $64 million in assets, invests directly or indirectly in the country. In the long term, the fund hopes to bring its Vietnamese ventures public and move into listed companies. Its holdings include textile factories, a New Zealand-listed conglomerate with interests in food processing and construction, and a water park in Ho Chi Minh City. This last venture seems an unlikely one until you consider that 60% of the city's population is under 25, with ever more money to spend.

Vietnam wants a stock market, but that may be a long time coming. In the meantime, emerging-markets guru Mark Mobius of Templeton Emerging Markets has rerouted his Templeton Vietnam Opportunities to companies doing business in Vietnam. His largest holding: New World Development, a Hong Kong company that owns Hotel New World Saigon, Vietnam's biggest hotel. Mobius is shifting to direct investment and says the fund should close its first deal--probably in real estate--any week now.

Vietnam will be growling as fiercely as its tiger neighbors around the turn of the century, and Cuba will be an economy to reckon with sometime after that. In the meantime, you need patience and savvy. The bureaucracies in both countries are infuriatingly slow, and business and finance laws range from rudimentary to murky. But as Beta CEO Peter Scott says, "If you wait until everything is perfect, the prices have already gone up."

VICTORY FOR S&LS

At 9:15 a.m. on August 30, Stephen Trafton, CEO of California's Glendale Federal Bank, stood tall at 14,465 feet, having just climbed solo to the top of Colorado's Castle Peak. He deserved to be that close to heaven. At about the same time in Washington, D.C., the U.S. Court of Appeals was ruling 9 to 2 that the government had entered into a contract with Glendale, breached it, and now is liable for damages. FORTUNE anticipated this big legal victory last May and predicted a windfall for investors. We were right. Glendale's stock has since risen 39%, and shares of some other thrifts with similar claims, including Long Island Bancorp of Melville, New York, have increased even more. The U.S. has at least 90 days to decide if it will appeal this latest ruling to the Supreme Court.

Altogether, some 90 S&Ls are suing for an estimated $15 billion in damages, a collective beef going back to the early 1980s when the Federal Savings & Loan Insurance Corp. encouraged strong thrifts to buy weak ones. Short of cash, the FSLIC allowed the acquiring banks to offset the excess debt of the institutions they bought by carrying it as "supervisory goodwill" or "regulatory capital credits" on their balance sheets. The 1989 S&L bailout, however, saw an end to this bookkeeping provision and left many S&Ls stripped of capital.

What next? If the government is prepared to settle now, Trafton says he's open to "constructive and creative ways to settle the liability." Otherwise he'll play much tougher. "The only remedy will be cash, and the liability of the American taxpayer grows." This last prospect could scare politicians. Washington lawyer Dan Goldberg, general counsel for the FSLIC in the late 1970s, thinks some in Congress could try to push through legislation before the 1996 elections that would pay the thrifts some 30 cents to 40 cents on the dollar.

Many of these same thrifts are also take over candidates, which adds to their appeal. James Marks of Hancock Institutional Equity Services figures that shares of Glendale, as well as Coast Savings and California Federal, both in Los Angeles, could appreciate at least 20% if thrifts win their suits-and double if they also become takeover targets. At $16 a share, Glendale trades at 1.2 times book value, about the national average for thrifts; but the $1.4 billion in damages it wants would add almost $12 a share. If the thrift is also sold, Marks values its shares at $36.50.

Salomon's Bruce Harting likes Long Island Bancorp because "they have the strongest case of anyone, with a written contract that spells out the promise the government made." Harting puts a take over-plus-goodwill price of $40 on the $25 stock.

--Susan E. Kuhn