Global funds back Việt Nam’s stock market upgrade

Global funds back Việt Nam’s stock market upgrade

Market Insider reported on September 29 that early voting shows around 85 per cent of 26 major global funds consulted endorsed Việt Nam’s upgrade.

An investor in HCM City Stock Exchange. An upgrade could bring in between US$5 billion and US$7 billion in passive inflows. — VNA/VNS Photo

Việt Nam is moving closer to a long-awaited upgrade of its stock market as many of the world’s largest asset managers signal strong support for FTSE Russell to reclassify the country from a Frontier Market to a Secondary Emerging Market.

Market Insider reported on September 29 that early voting shows around 85 per cent of 26 major global funds consulted endorsed Việt Nam’s upgrade. Among the supporters are some of the world’s biggest investors, including BlackRock, Vanguard and State Street, which pointed to stronger liquidity and tighter regulatory alignment in the market.

Fidelity and PIMCO also expressed support, though with caution, stressing the need to monitor the rollout of the new KRX trading platform, expected in the second quarter of 2026.

According to Market Insider, Việt Nam’s stock market liquidity rose by 15 per cent in the last quarter, further strengthening its case for inclusion.

It also noted that Decree 245/2025/ND-CP has eased concerns over foreign ownership limits and currency risk, addressing two issues long viewed as obstacles for foreign investors.

FTSE Russell is scheduled to announce the outcome of its classification review after the US market closes on October 7. If approved, Việt Nam will join the FTSE Secondary Emerging Market Index in March 2026, a milestone that could reshape capital flows into one of Southeast Asia’s fastest-growing economies.

Analysts cited by Market Insider estimate that an upgrade could bring in between US$5 billion and US$7 billion in passive inflows, with further allocations from active funds to follow.

HSBC noted that such a move would automatically add Việt Nam to indexes including FTSE All-World, FTSE EM and FTSE Asia, prompting passive funds to buy Vietnamese stocks or ETFs.

Việt Nam’s Finance Minister told Reuters on September 19 he was “pretty confident” that the upgrade “would be confirmed next month”, reflecting optimism that the country is on the brink of a historic reclassification in global equity benchmarks. 

Bizhub