Foreign ETFs worth 700 million USD excel thanks to Vingroup stocks, why are they still facing capital withdrawals?

The two foreign ETFs, VNM and FTSE, worth nearly 700 million USD, have seen performances over 11% since early 2025, outpacing the VN-Index due to the significant share of Vingroup stocks. Notably, VIC, VHM, and VRE are among the top investments in their portfolios. But despite this success, VNM ETF has seen withdrawals of more than 61 million USD and FTSE ETF nearly 18 million USD, attributed to limitations in acquiring restricted stocks and a lack of market diversity. While these ETFs typically perform well in rising markets, their returns may falter due to insufficient flexibility in portfolio structure. This reflects the challenges of Vietnam’s stock market, with the limited number of quality stocks. However, an upcoming wave of new listings anticipated between 2027-2028 and policy shifts focusing on private sector development could drive progress and enhance foreign investment capacity.