Over the past year, most investment funds in Vietnam’s equity market have seen negative growth in net asset value per share (NAVPS) due to the poor performance of the market indices.

 

NAVPS is an expression for net asset value that represents the value per share of a mutual fund, exchange-traded fund (ETF) or a closed-end fund. It is calculated by dividing the total net asset value of the fund or company by the number of shares outstanding. NAVPS is also referred to as the book value per share.

 

This year, the stock market witnessed the choppiest year since the 2008 global financial crisis. The VN-Index declined for the first time after five consecutive years of rallying in parallel with the growth momentum of the economy. It achieved a record high gain of 47 percent in 2017.

 

The VN-Index, Viet Nam’s benchmark stock index, set an all-time peak of 1,211 points on April 10, but then suffered a sharp decline of 27 percent, to end 2018 at 892.54 points, down 9.3 percent from the previous year, despite the fact that Vietnam’s GDP has posted its strongest growth rate in a decade.

 

The unexpected fall strongly affected investor sentiment, which is very vulnerable and mostly dependent on market movements and can be broken easily if any negative news is heard.

 

Pyn Elite Fund, the Finland fund which focuses on Vietnamese shares, saw NAVPS declining 10.15 percent. The figures for Dragon Capital’s Vietnam Enterprise Investment Limited (VEIL) were down 11.3 percent, JPMorgan VOF dropped 12 percent, ETF funds such as FTSE Vietnam ETF, slumped 11 percent, while VFMVN30 ETF lost 11.4 percent and VNM ETF plummeted 13 percent.

 

Passion Investment (PIF) and Hestia also had a disappointing year with NAVPS growth down 16 percent and 24 percent, respectively.

 

Funds with better performance included Tundra Vietnam Fund, VOF VinaCapital, SSIAM VNX50 ETF, LionGlobal Vietnam Fund and Thiên Việt Securities Joint Stock Company’s two funds of Thien Viet Growth Fund (TVGF) and TVGF2.

 

TVGF and TVGF2 were two of the funds with the best performance in the market last year, with NAVPS dropping just 3.7 percent and 6.5 percent, respectively, lower than the decline of the VN-Index at 9.3 percent in 2018.

 

By the end of 2018, the total investment portfolio value of TVGF reached 196.5 billion VND (8.4 million USD) while the figure for TVGF2 was 157.4 billion VND.

 

SSIAM VNX50 ETF performed quite well compared to the overall market, with NAVPS down 6 percent. Total fund assets as of the end of 2018 reached nearly 120 billion VND.

 

Contrary to the tragic situation of stock investment funds, bond investment funds had a successful year in 2018.

 

The best performance belonged to VFMVFB, managed by VietFund Management (VFM), with NAVPS growth of more than 11 percent.

 

Bao Viet Fund Management Co Ltd’s BVFB fund also had a successful year, with NAVPS climbing by 10.1 percent in 2018, and was the fund with the second best growth in the market.

 

NAVPS of two bond funds, VTBF managed by VietinBank Capital and TCBF managed by TCBS, also grew well with an increase of 9 percent and 8.2 percent, respectively.

 

VinaWealth bond investment fund (VFF) of fund management company VinaWealth, a VinaCapital-backed unit, saw NAVPS growth of 7.1 percent in 2018. Meanwhile, the figure for SSIBF managed by Saigon Securities Incorporation was 6.6 percent.

 

In 2018, the stock market witnessed strong fluctuations and cash flow tended to shift to bond funds. Viet Dragon Securities Co (VDSC)’s statistics show that the largest bond investment fund, Techcom Bond Fund (TCBF), had expanded its assets scale by 185 percent compared to the beginning of the year. From September to November 2018, TCBF attracted about 700 billion VND of new investments each month.-VNS/VNA