Thailand would be close the bottom of the average pension fund's list of preferred markets at this moment. Nonetheless, Thailand was one of only a small number of emerging markets to start the year on a positive note.

In terms of locally-run funds, there is a selection of listed investment trusts, but most of them are less than $10m in size and are highly illiquid.

Old Mutual International's Asian investment strategist Ashok Shah says there are four or five Thai investment trusts at the $40-$50m level, but adds: "Liquidity is ex-tremely difficult". However, OMI is taking a more favourable view of Thailand after the precipitous fall of both the market and currency, although it has left little of the size and quality to interest international invest-ors," says Shah.

James Hancocks, emerging markets specialist at Guinness Flight, says, "We have participated in the recent rally, but now we believe share prices have to fall again before we're looking at fair value. For example, domestic plays who are very defensive in terms of their balance sheet are trading at 25 - 30 times historic peak earnings."

The banks, as such a large component of the market, desperately need recapitalisation. Investor confidence in the Thai Government was boosted by the creation of the Financial Restructuring Agency, a state-owned commercial bank set up at the behest of the IMF to manage and ultimately sell 56 finance companies closed last year.

There are a handful of Thailand funds run out of Hong Kong by the likes of Jardine Fleming, Dresdner Thornton, HSBC and Indosuez/Credit Agricole. JF's Thailand fund is the top performer over one year, but as the figures show, even that means a negative return of -22.5%. Thornton's Thailand sub-fund of the NT Selections umbrella topped the Lipper fund rankings in February. But as Lipper notes in regard to Thai funds launched after 1990, all have produced a negative return since inception."

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