The largest foreign ETFs in Vietnam, VNM ETF and FTSE ETF, recently reported impressive performance with returns exceeding 11% since the beginning of 2025, attributed to the strong growth of Vingroup stocks such as VIC, VHM, and VRE. However, both funds experienced significant capital withdrawal, with over 61 million USD from VNM ETF and nearly 18 million USD from FTSE ETF. A part of the reason is that these funds cannot purchase stocks with limited foreign room, leading to lower performance compared to the market in 2024. Despite achieving good performance, restrictions in the investment portfolio make it difficult for the funds to attract capital flow, while the Vietnamese stock market lacks a diversified range of sufficiently large stocks to appeal to foreign funds. The prospect of market upgrade may improve this situation but also poses challenges if capital from emerging market-oriented funds continues to exit. As Vietnam prepares for a new wave of goods and focuses on developing the private economy, this is expected to create new opportunities for the market.
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