Mutual Fund Investors Feel a Sense of “Missing Out”
As of the end of May 2025, the VN-Index has recovered all the points lost during the volatile period due to tariff concerns. Against this positive market backdrop, open-end stock funds also rebounded from their lows, turning to impressive profits.
Specifically, during the period from April 10 to the end of May 2025, some typical open-end funds achieved profits of more than 20%, including DCDS with a gain of 26.41%, VCAMDF at 26.26%, VCBF-BCF recording a profit of 23.51%, BVFED: 20.75%, UVEEF: 20.59%, and VINACAPITAL-VESAF: 20.29%.
However, the performance of stock funds has been recovering slower than expected by investors. The reason for this can be easily explained by the fact that the VN-Index’s upward momentum in the past has been largely led by large-cap real estate stocks such as VIC, VHM, and VRE, which are not prioritized in the portfolios of many open-end funds because they do not meet investment criteria.
Previously, this group of stocks had gone through a deep correction, wild swings, and potential valuation risks, causing investment funds to be cautious and not aggressively increase their holdings. This has created a sense of “missing out on the uptrend” for quite a few open-end fund investors.
In contrast, the fundamental stocks that are the backbone of most open-end fund portfolios have underperformed, affecting fund performance. For example, FPT, one of the most widely held stocks, has fallen more than 30% from its peak. Or the bank group of stocks, which are also weighted by open-end funds, but with a large divergence.
In fact, the selection of stocks is usually carefully considered by funds in terms of business prospects, transparency, and the level of risk of each industry, rather than just relying on immediate price fluctuations.
Financial analyst Huynh Hoang Phuong believes that investors should evaluate the effectiveness of the fund over a 3-5 year period. There are times when the fund temporarily underperforms the market, but this can also be an attractive accumulation opportunity if the fund has a solid investment strategy and a good fundamental portfolio.
Data from Fmarket – the platform that concentrates the most open-end funds in Vietnam shows that over a 5-year cycle, most open-end funds have recorded impressive NAV growth, despite the strong corrections in the market.
Leading this profit margin is the VINACAPITAL-VESAF fund with a profit of 21.8%/year. Following are SSISCA (18.8%), DCDS (18%/year), VINACAPITAL-VEOF (17.8%/year), and VCBF-BCF (17.3%/year), outperforming the VN-Index’s growth of only 9.2%/year in the same period (as of May 30, 2025).
This result clearly reflects the effectiveness of the long-term investment strategy and disciplined portfolio management pursued by open-end funds.
Long-Term Opportunities from Institutional Reform
In 2025, Vietnam is entering the “Renewal 2.0” phase, focusing on institutional reform and promoting the private sector. Resolution 68 clearly states the goal of making the private sector the growth driver, with the average growth rate of the private sector reaching about 10-12%/year, higher than the growth rate of the economy; contributing about 55-58% of GDP, striving to have 2 million enterprises operating in the economy and at least 20 large enterprises participating in the global value chain.
According to Mr. Dinh Duc Minh, Senior Investment Director at VinaCapital, Resolution 68 will create new investment opportunities in the coming years. Among the large enterprises “participating in the global value chain”, many are listed on the stock exchange, and investors can easily choose stocks that achieve a compound growth rate of about 15%/year in the next 5-10 years.
According to Mr. Minh, a correct investment strategy is to choose the right growth stocks, reasonably priced, and patiently hold on to them. However, instead of doing this whole process themselves, individual investors can completely entrust professional investment funds, which are organizations capable of in-depth analysis and making decisions in a methodical way.
“While investors worry about what to buy and sell, investors in funds only need to do one thing: maintain their psychology and invest for the long term. Let the fund management company take care of the rest,” emphasized Mr. Minh.
Currently, the P/E valuation is 13.1 times, which is below the 5-year average. This is still considered an attractive valuation range, offering potential opportunities for long-term investors to accumulate quality stocks at a high discount.
Although investors are eagerly awaiting the outcome of tariff negotiations in July, fund managers have already prepared scenarios to deal with each situation.
According to forecasts by fund management companies, the most likely scenario is a 20% tax rate, in which case the growth in profits of listed companies can still reach 13%/year.
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