Vietnam’s stock market has gained achievements over the last 20 years, but a lot of problems still exist.

The market has three major indexes, namely the VN, HNX, and the UpCom Index. The HNX Index was set up 15 years ago at the starting threshold of 100 points and has increased by 10 percent only, a very low rate.

Meanwhile, UpCom Index, which also started with 100 points, has fallen by half after 11 years.

Most foreign investors in Vietnam’s stock market are small investors, while big investors only contribute capital into projects and enterprises. If these problems are fixed, bigger investment institutions and bigger capital will flow to Vietnam.

Many policies have existed for 20 years, but they have been slow to change.

In the first phase of the stock market, the T+4 payment mechanism was applied. It took nearly 10 years to shorten the payment time to T+3 and another five years to shift to T+2.

Vietnam planned the launch of new products, including derivatives, in 2003-2005, but they have only been available since 2017. It also took a long time to launch warrants.

Regarding the policy, the Investment Law in 2005 mentioned the lifting of the foreign ownership ratio ceiling, but only in 2015 were decrees and circulars on this issue released.

Most foreign investors in Vietnam’s stock market are small investors, while big investors only contribute capital into projects and enterprises. If these problems are fixed, bigger investment institutions and bigger capital will flow to Vietnam.

Experts said that there are two things that need to be done immediately – shortening the payment time and lifting the foreign ownership ratio ceiling.

They suggested providing foreign investors with the option of holding non-voting shares, which is believed to be a reasonable solution to the foreign ownership question.

Vietnam has reviewed the operation of the stock market over the last 20 years. The capitalization value of the market is just 1/5 of the Philippines’, 1/7 of Indonesia’s and 1/8 of Thailand’s.

Mai Lan 

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20 years of Vietnam’s stock market

The Ho Chi Minh City Securities Center (the forerunner of the Ho Chi Minh City Stock Exchange, or HoSE) held its first trading session in July 2000, marking the birth of Vietnam’s securities market.