Source of this article: Times Finance Author: Xu Weiqiang The Vietnamese stock market, which was the "world's most powerful stock market" in the first half of the year, suddenly collapsed overnight. On July 12, Vietnam's stock market suffered a heavy blow, with the Ho Chi Minh In

This is just a manifestation of the hot Vietnamese stock market.

The Vietnam stock market has been rising sharply for many years. In 2017, Vietnam's stock market rose 48%, surpassing South Korea, India and Hong Kong stock markets, becoming the best-performing stock market in the Asia-Pacific region. In 2018, the Ho Chi Minh Index broke through 1,200 points, reaching a high of 1,211.34 points, setting a new high in 11 years. In 2020, Vietnam's stock market experienced adjustments, but the Ho Chi Minh Index rose about 21% throughout the year, and the index rose to 1,100 points again.

Regarding the sharp drop in Vietnamese stock market, the Vietnamese market generally believes that the fuse comes from the sudden outbreak of the epidemic.

The epidemic directly brought a huge impact on the local economy, and many factories in Vietnam were closed because employees detected new crown . In June this year, Vietnam's manufacturing PMI data reached a contraction range of 44.1, a sharp decline from 53.1 in May.

In addition to the epidemic factors, Lai Haizun believes that foreign capital has also contributed to the surge in the Vietnamese stock market. While the Vietnamese market was still rising in the first half of the year, foreign capital was already starting to withdraw. Since the Vietnamese market is mainly retail trading, foreign capital will have greater influence. Under the influence of the massive selling of foreign capital, retail investors also fled one after another, forming a stampede effect.

Some domestic investors have turned to the Vietnamese stock market

Facing the "feast" of the Vietnamese market, some domestic investors have also turned their attention to it.

"The Vietnamese stock market has performed well in recent years, and some investors have also moved to Vietnam in Shenzhen." On July 13, , Zhang Yixuan, chairman of Shenzhen Zhongyi Investment, revealed to Times Finance that as early as 2015, there was a private equity institution in Shenzhen. It judged that the Vietnamese market would have relatively good prospects and chose to go to Vietnam to develop, which also achieved good results.

But Zhang Yixuan also told Times Finance that due to restrictions on entry and exit of funds, these domestic investors who switch to Vietnam all invest their own funds and it is difficult to issue private equity products.

According to his understanding, domestic capital participation in Vietnamese stock market is more of the industrial funds transferred to Southeast Asia in recent years. Due to the good economic development in recent years, especially with the changes in Sino-US trade relations, many Pearl River Delta companies have gradually moved to Vietnam, and keen investors have also discovered investment opportunities.

. Regarding how many private equity institutions are involved in the Vietnam market, Times Finance learned from Private Equity Ranking Network that there are currently no relevant statistical data. According to a person related to the Private Equity Ranking Network, if a private equity invests in the Vietnamese market, it can either switch income rights or set up an offshore fund. Previously, private equity investment in , US stocks, , was used in this way.

For ordinary domestic investors, they can also use the public offering channel to participate in the Vietnam market. Times Finance learned that there is currently only one fund in China to invest in Vietnamese stock market, which is the Tianhong Vietnamese market stock (QDII) fund, which has also become the main channel for domestic investors to invest in Vietnamese market.

According to Tiantian Fund Network , Tianhong Vietnam Market Stock (QDII) Fund was established on January 20, 2020, with an initial scale of 199.9 million shares. The fund is the Vietnamese theme fund , which mainly invests in stocks, depositary receipts, etc. issued by Vietnamese theme companies in the securities market.

Times Finance found that the initial trend of the fund after its establishment was not ideal, and it fell below its net value after it was issued and fell all the way. The lowest point was March 24, 2020, with a return of -24.90%, a loss of nearly 1/4. But then the product began to fluctuate upward.

On January 28 this year, the return of this fund was -1.58%, the average return of similar funds was 6.15%, and the increase of Shanghai and Shenzhen 300 was 9.97%.

At the end of February, the fund began to make efforts, with rapid returns surpassing similar products. As of July 9, the net value of the fund was 1.5619, and the increase since its establishment reached 56.19%. Among them, the increase in the past June was 26.59%.

The rapid growth of the fund's profits has also attracted the influx of domestic investors. According to the first quarter report, the fund's share size has reached 485.89 million shares by the end of March this year, an expansion of 2.43 times. The asset scale has also reached 617 million yuan.

"Niba Market" investment should be cautious

In addition to Tianhong Vietnam Market Stocks (QDII) funds, some investors also use the US market.

Times Finance learned that some investors invested in a Vietnamese ETF product, VanEck Vectors Vietnam (NYSE:VNM), which tracks the Vietnam index and has also attracted many investors to follow.

"Relatively speaking, the Vietnamese market is still too niche." Regarding the fact that domestic fund companies rarely deploy in the Vietnamese market, a marketing person from a fund company in Shenzhen explained to Times Finance on the 13th that most Chinese investors do not know much about the Vietnamese market, so the issuance of such products is somewhat "non-mainstream". The main investment in overseas markets is the US stock market and Hong Kong stock . In addition, domestic fund managers and researchers are mostly studying US stocks and Hong Kong stocks, and there is not enough research on Vietnamese stock market, which also limits the development of such products.

"It's really too niche." Lai Hai said that before, domestic private equity investments in India, Vietnam, Cambodia and other markets, but mainly through the Hong Kong market and rarely through domestic channels. At present, domestic private equity funds can use QDII. Previously, they were mainly issued by securities companies and public equity funds. Since the investment effect was not ideal, some quotas would be given to private equity funds, but the investment direction should be registered and relevant supervision should be accepted.

Lai Haizun believes that although Vietnam's economic development data in recent years have also been very good, overall, it is mainly based on processing and manufacturing. The entire industry lacks core competitiveness and the scale of the industry is not large. Previously, when domestic manufacturing was transferred to Southeast Asia, some funds also followed, but soon "weakness and local conditions" occurred, and in the end they had to evacuate sadly.

Lai said that when domestic investors need to be cautious when foreign markets, from national policies and institutional rules to corporate financial data, there is relatively lack of information symmetry.