At the 25th-anniversary celebration of Vietnam's stock market, Vu Thi Chan Phuong, Chairwoman of the State Securities Commission (SSC), stated that one of the key tasks for the industry is to improve quality and aim for sustainable investment demand. The goal is to achieve a reasonable balance between individual and institutional investors, as well as between domestic and foreign investors.

Vu Thi Chan Phuong, Chairwoman of the State Securities Commission. Photo: Tat Dat

Vu Thi Chan Phuong, Chairwoman of the State Securities Commission. Photo: Tat Dat

The SSC will focus on developing various types of securities investment funds. They will research and draft legislation for money market funds, complex exchange-traded funds (ETFs) such as leveraged and inverse ETFs, and fund-of-funds. In addition to diversifying fund distribution channels, the SSC will encourage investor participation through these investment funds, especially voluntary supplemental pension funds.

According to data from the Vietnam Securities Depository (VSD) at the end of June, the market has nearly 10.3 million investor accounts. Domestic individuals account for over 99.3% of these. There are only 18,339 domestic institutional investor accounts and 4,669 foreign institutional investor accounts.

Don Lam, CEO of VinaCapital, agreed that professionalizing the market requires promoting domestic institutional investors. He believes this is crucial for sustainable market development, as these investors play a key role in developing and implementing new financial products, especially voluntary pension funds, a cornerstone of national finance in developed countries.

VinaCapital data shows Vietnam's stock market capitalization reached 62% of its 2024 GDP, significantly lower than other countries in the region: South Korea (90%), Malaysia (93%), Thailand (104%), and Singapore (118%). In these countries, the growth drivers for stock markets reaching similar GDP levels are the increasing number of investment funds, a surge in initial public offerings (IPOs), and especially the development of domestic institutional investors.

Nguyen Van Thang, Minister of Finance. Photo: Tat Dat

Nguyen Van Thang, Minister of Finance. Photo: Tat Dat

Nguyen Van Thang, Minister of Finance, assessed that over the past 25 years, the stock market has become a vital channel for medium and long-term capital mobilization for the economy, and an attractive investment channel for over 10 million investors. Consequently, the stock market is a crucial pillar of the national financial system, alongside banking and insurance.

To further develop the market, the Minister of Finance suggested continuing to effectively restructure its pillars by strengthening institutional investors, improving the quality of goods, and diversifying products and services.

He added that regulatory bodies are also focusing on measures such as improving legal frameworks to meet international standards, ensuring safe market operation, and strengthening supervision to ensure transparency and upgrade the market soon.

Tat Dat