This crisis has been so sudden the market needs time to readjust itself. In particular, investors and issuers need to compromise on the level at which debt securities are trading.

In a period of volatility, obviously new issues will decrease and existing issues will trade tactically.

The recent market changes will clearly affect fund managers in the designing of their portfolios. However, the low prices may provide them with an opportunity to buy, Ms Wong said.

She said the fundamentals of the Hong Kong economy were still sound and that was the reason the Hong Kong dollar had been the only Asian currency to survive the recent threat to its currency peg to the US dollar.

Equally optimistic is Andrew Pang, director of investments at Principal Insurance. He said the current losses did not amount to much over the long term.

'I think people only have to look back as far as 1995 when the markets took a hit and we were running around saying the sky was falling in,' he said.

'At that time it seemed as if it was but, since then, we've had a huge run-up. In the investment world, in everywhere but Hong Kong, two- and-a-half years is not a long time.' However, most analysts agree there are lessons to be learned from the recent market turmoil.

Not least is the question of how to administer the $30- $40 billion of pension fund money expected to enter the market once the Mandatory Provident Fund (MPF) is established.

There will be additional discussions about the MPF and the type of investments allowed.

There would be many arguing that the fund should stay out of Hong Kong dollar assets and others arguing for only a guaranteed fund backed by the Government, Mr Pang said.

He said the recent market volatility could also be used as a good argument for going ahead with the MPF, since the increased amount of pension money in Hong Kong stocks could help stabilise the market.