Investors in Asian equities are caught in a cruel no-man's land where prices have fallen too far to sell, but not low enough for them to buy into the region's long-term potential.

If you start to sell some of the Asian stocks now, you are coming out at a time when they are very, very cheap, according to Mr Sean Darby, Asian equity strategist at Dresdner Kleinwort Benson.

"On the other hand, your gut feeling might be that you should be buying, but by being a little bit brave you'll get taken out by external events forcing prices down," he said.

Portfolio investors in Asia have been hammered by the risks of slowing global growth, fund redemptions and a turn in sentiment against high-tech new economy plays that propelled regional stock markets 53 per cent higher on average last year.

None of emerging Asia's eight leading equity indices from Singapore to South Korea are positive for the year, and almost all are below pre-Asian crisis levels.

Mr Darby says sentiment on Asia is too weak. "Irrespective of where you think growth is, some of the stocks now are priced as if they're going bust, but they're not and we're not going to have another Asian crisis," he said.