Vietnam Sees Over 2 Million New Securities Accounts in 8 Months, Surpassing Government Target

According to the Vietnam Securities Depository and Clearing Corporation (VSD), Vietnam's securities trading accounts reached approximately 13.9 million by the end of August. This marks a significant increase of over 2 million new accounts opened in the first eight months of the year, the fourth time in the market's history that this milestone has been reached. The total number of accounts now represents about 13.6% of Vietnam's population, surpassing the government's target of 11 million accounts by 2030. Domestic individual investors account for a dominant 99% of these accounts, with foreign and domestic organizations holding only about 25,191 accounts, or 0.18%. The remainder belongs to foreign individual investors. The surge in new accounts comes as FTSE Russell, a leading global index provider, officially confirmed Vietnam's upgrade to the secondary emerging market status, effective September 21. However, the VN-Index has only seen a modest increase of around 2% year-to-date, largely driven by Vingroup-related stocks. Average daily trading liquidity on the Ho Chi Minh Stock Exchange (HoSE) has decreased by 8% compared to last year, standing at approximately 24.4 trillion VND. SSI Securities Corporation forecasts that the market may enter a consolidation phase with increased selling pressure in the latter half of September, once the capital inflows from the FTSE Russell upgrade have been absorbed. Historical data from SSI shows that the VN-Index has declined in September three times over the past five years, with an average decrease of about 3.5%, while the rest remained flat. Furthermore, SSI anticipates that interest rates may not cool down significantly in the short term, especially with credit demand expected to accelerate towards the end of the year. High interest rates could impact the stock market. SSI's analysts view September as a period of accumulation rather than the start of a new bull cycle. They suggest that the market's upward trend around the upgrade event presents an opportunity for investors to realize profits and reduce their holdings in high-beta stocks – those with higher price volatility that are more sensitive to the overall market index. Despite short-term concerns, SSI maintains a positive outlook on the market's medium-term prospects.