In Vietnam, the dream of upgrading the stock market from frontier to emerging market is expected to be realized by 2025. If successful, the market could attract $800 million from passive investors using the FTSE index and $2 billion from other investors. However, to attract large capital flows, stocks need to have foreign ownership room (room ngoại). Most large-cap stocks still have room for foreign investors, but in reality, this is often limited due to the controlling shareholding by the state or large shareholders. Many stocks are held by individuals or other organizations, reducing the effective foreign room. The upgrade criteria are also stricter, with requirements on free float and foreign ownership limits. Some stocks expected to benefit from the upgrade include VNM, VHM, VIC, and HPG. However, the market is still under pressure from net foreign selling, with total net selling worth over 100 trillion VND over the past year, making expectations of foreign capital less optimistic.
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