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.
Bao Viet Fund Management Co Ltd’s BVFB fund also had a successful year, with NAVPS climbing by 10.1 per cent in 2018 and was the second best performing fund. (Photo: congluan.vn)
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 piding 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 per cent in 2017.
The VN-Index, Vietnam's benchmark stock index, set an all-time peak of 1,211 points on April 10, but then suffered a sharp decline of 27 per cent, to end 2018 at 892.54 points, down 9.3 per cent 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 per cent. The figures for Dragon Capital’s Vietnam Enterprise Investment Limited (VEIL) were down 11.3 per cent, JPMorgan VOF dropped 12 per cent, ETF funds such as FTSE Vietnam ETF, slumped 11 per cent, while VFMVN30 ETF lost 11.4 per cent and VNM ETF plummeted 13 per cent.
Passion Investment (PIF) and Hestia also had a disappointing year with NAVPS growth down 16 per cent and 24 per cent, respectively.
Funds with better performance included Tundra Vietnam Fund, VOF VinaCapital, SSIAM VNX50 ETF, LionGlobal Vietnam Fund and Thien Viet 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 per cent and 6.5 per cent, respectively, lower than the decline of the VN-Index at 9.3 per cent in 2018.
By the end of 2018, the total investment portfolio value of TVGF reached VND196.5 billion (US$8.4 million) while the figure for TVGF2 was VND157.4 billion.
SSIAM VNX50 ETF performed quite well compared to the overall market, with NAVPS down 6 per cent. Total fund assets as of the end of 2018 reached nearly VND120 billion.
Winning bond funds
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 per cent.
Bao Viet Fund Management Co Ltd’s BVFB fund also had a successful year, with NAVPS climbing by 10.1 per cent 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 per cent and 8.2 per cent, respectively.
VinaWealth bond investment fund (VFF) of fund management company VinaWealth, a VinaCapital-backed unit, saw NAVPS growth of 7.1 per cent in 2018. Meanwhile, the figure for SSIBF managed by Saigon Securities Incorporation was 6.6 per cent.
In 2018, the stock market witnessed strong fluctuations and cash flow tended to shift to bond funds. Việt Dragon Securities Co (VDSC)’s statistics show that the largest bond investment fund, Techcom Bond Fund (TCBF), had expanded its assets scale by 185 per cent compared to the beginning of the year. From September to November 2018, TCBF attracted about VND700 billion of new investments each month.