Bermuda's Stock Exchange (BSX) is being touted to Canadian investors looking for an opportunity to put their money into a virtually untapped market, according to a report in the Toronto Globe and Mail.

The report said that the BSX offered some of the best bargains for long-term investors who don't mind being limited to buying small amounts of stock, and while the Exchange has only 15 domestic companies listed and shares can trade infrequently and when they do in modest volumes, it is also one of the least expensive markets available full of small and micro-cap businesses often overlooked by most investors due to the tiny amount of stock outstanding.

According to the report, the combined value of all the domestic companies on the Exchange is around $2 billion with its size making the companies unappealing to institutions that need to own easily tradable securities they can purchase in enough bulk to make an impact on their results, while the lack of name recognition means most individual investors unfamiliar with the Island have never heard of them.

Jeremy Dyck, an investment adviser with LOM Securities (Bahamas) Ltd., told the paper: "You can certainly make the case that it's undervalued.

"I've been advising some clients...to take a look at some of these stocks at certain prices."

The stocks are ideal for long-term buy-and-hold investors, provided you are "happy with a large dividend and you don't mind not having too much liquidity," he said.

Mr. Dyck told The Royal Gazette, yesterday, that he still recommended BF&M Ltd., Keytech Ltd. and to a lesser extent, the Ascendant Group Ltd. of the BSX-listed stocks.

BF&M along with the Argus Group Holdings Ltd., the only other insurance company listed on the Exchange, trade at single-digit price earnings multiples - a rarity in today's market, while utility provider the Ascendant Group trades for half of book value and offers a 4.4-per-cent yield and KeyTech provides an even better 6.5 percent yield, according to figures compiled by the BSX.

And because the shares on the Exchange seldom trade, Mr. Dyck recommends placing limit orders, or orders to buy stock at a fixed price.

He believes Bermuda stocks as a whole have been beaten down as a result of the Island's economy being heavily dependent on insurance and other financial industries, among those businesses that have been hit hard by the international banking crisis.

The article points out that there is only one restriction for overseas investors looking to acquire stock - that Bermuda requires that 60 percent of shares are held by residents.

The BSX's president and CEO Greg Wojciechowski was in Toronto last week as part of a delegation pitching the Bermuda market to investors, including its catastrophe bond offerings.