Invest in individual companies and do not put all of your money into one industry during the current financial crisis.

That was advice given to concerned investors at the Bermuda Investment Advisory Services's (BIAS) quarterly market briefing for the fourth quarter of 2008 held at the company's offices in Par-la-Ville Road yesterday.

They were told that the market is expected to bottom out in six to nine months time and could take seven years to fully recover from today's economic meltdown.

Investors must have wondered what they had let themselves in for when they were presented with a reading by BIAS chief executive officer Robert Pires taken from Fortune magazine about the Four Horsemen of the Apocalypse.

"We are in what we refer to as a sub-prime tsunami and it is unprecedented in our lifetime and it is extremely difficult to absorb and come to terms with, but we believe that we have to keep moving because there will be inevitable opportunities to come out of this," he said.

Mark Melvin, chief financial officer of BIAS, then gave a talk on the current state of the capital markets and the impact they had on investments, with credit spreads increasing as investors flee to US Treasuries, liquidity drying up and market volatility reaching all-time high among other effects.

He said equity markets had fallen across the board, including global equities (43.86 percent), corporate bonds (11.79 percent), gold (9.04 percent), hedge funds (16.17 percent) and real estate (14.72 percent), versus those which had risen such as US Treasuries (10.49 percent) and the US dollar (13.7 percent).

"In all my time working in the business I have never seen an occasion when all the asset classes are down," he said.

"The only thing that has been positive has been Treasuries and the US dollar, and most of that has been probably in the last two months."

Mr. Melvin cited the TED spread, comparing the rate at which the banking sector borrows relative to the US Government, as an example of the lack of confidence in the market, as well as looking at the decline in US employment and confidence as signs of the impact the turmoil was having on the global economy.

Among the other indicators, he said, were frozen credit markets, the drying up of new capital, Government intervention to deal with the problem and slowing growth.

On a worldwide financial sector basis, write-offs were approaching $1 trillion and mounting, while smaller markets like Iceland, Hungary, Argentina, Belarus and the Ukraine, investment banks, the hedge fund industry, industrial icons, including Ford and General Motors, banks and the insurance industry were all struggling to survive, according to Mr. Melvin.

He said the US Government's response was to throw money at the situation in the form of the Troubled Asset Relief Programme and other moves with a potential cost of $1.9 trillion. The European policy response had been more aggressive than that in the US, with the EU's $3.9 trillion bailout package and the UK Government's £500 billion bailout deal.

"When we look at the recovery checklist, confidence has begun to return to the financial system as TED spread narrows and while bond market liquidity has not improved, pricing has, but there has been a peak in unemployment claims, home prices have stopped declining and housing starts have been stabilising and money supply has increased," he said. "These are good early indicators, but we are not out of the woods yet."

Mr. Pires took the stage again to encourage investors that there was some opportunity to be had from all of this chaos, looking at how the market had bounced back from previous crises such as the oil shock of the 1970s, the Latin American debt crisis, Black Monday in the 1980s, and the 2002 Enron and Worldcom scandals.

He showed a list of bear markets since and including the Great Depression of 1929, when the average duration was 19.7 months with a peak to trough average of -37.5 percent compared to the 13-month timespan and -44.2 percent peak to trough of the current crisis, from October 2007.

Similarly, Mr. Pires reflected on the bull markets since 1932, which averaged 58 months in duration and a trough to peak of around 200 percent, while the greatest ever bull market enjoyed a 843 percent return in the wake of the Stock Market Crash of 1987.

"Traditionally after a fall there should be a recovery," he said. "Our conclusion is that three out of six of the longest bear markets preceded three out of six of the longest bull markets.

"The five longest and deepest bear markets averaged 30 months and dropped 52 percent, the average bull market which followed a bear market lasted for 58 months and gained 200 percent."

Bryan Dooley, senior investment strategist at BIAS, then gave an overview of BIAS's various funds for income, balance and equity and how they had been adjusted to deal with these tough economic times and give the best return to investors.

He said the companies which would do well out of the current financial predicament and the subsequent cycle would have to be recession resistant, pay dividends, have low debt levels, have a simple business model, be big enough to access capital, have visible earnings and a leading market position.

"It is going to be a select group of companies that will actually survive this economic crisis and do well," he said.

"A company that can outgrow the economy is a company that can stay stable in this environment."

Mr. Dooley recommended UK bank Barclays, generic drug maker TEVA Pharmaceuticals, the largest US waste disposal, hauler and recycling company Waste Management Inc., Pinnacle West Capital, an Arizona power utility company, fertiliser company Potash Corporation of Saskatchewan and Banco Itau, the second largest bank in Brazil.

Mr. Pires wrapped up the meeting by saying it was too early to call what would happen at this early stage of a bear market, but reckons there will be numerous opportunities for investors to take advantage of the situation.

"In this market, I think we need to be more select on specific stock," he said. "We are looking for companies that have a lot of cash on their balance sheets because the banking sector has frozen up.

"What we are looking at is six to nine months for this market to bottom out. This is an opportunity developing and I think the best way to do that is to add amounts on a monthly basis to your portfolios."