Monthly Updates, News, Vietnam


The Fund rose 20.6% (SEK) in April compared to the benchmark index which rose 14.1% (SEK). During the month, the market partially recovered as optimism increased towards a gradual reopening of the economy and resumption in business and trade activities. As the Fund is exposed to mid-cap growth stories that benefit from the enhanced economic activities we benefitted a bit more than the overall market. The Fund’s overweight in off-benchmark Consumer Discretionary (Phu Nhuan Jewelry, Dry Cell Battery & Storage and Danang Rubber) and Materials (Hoa Sen and Hatien 1 Cement) contributed positively for the Fund. In addition, our off-benchmark bet in Information Technology, FPT Corp, performed well on the back of stronger than expected result and payout. On the flip side, the Fund’s underweight in Real Estate (Vin group stocks), Consumer Staples (Vietnam Dairy and Masan), and Industrials (Vietjet Aviation) had a negative contribution to the Fund in April.

No major changes were made during the month.


Vietnam’s equity market went up by 14.1% (SEK) compared to an increase of 6.7% (SEK) and 5.4% (SEK) for MSCI Emerging Markets and MSCI Frontier Markets xGCC Net TR respectively. Promising news on easing lockdowns globally and progress on medications to treat COVID-19 propelled the market in April in line with the global markets. However, local investors were the main buyers as foreign investors remained sellers and offloaded around USD 292m worth of stocks in April. Liquidity marginally improved by 5% M/M to USD 186m in average daily traded value.

Vietnam implemented a nationwide lockdown from the 1st of April to the 15th of April which was then extended to the 22nd of April, with only essential services being allowed to open (e.g., food, finance, health). Vietnam has so far 271 reported infections of COVID-19, with 219 recoveries and according to official sources no fatality so far. On the face of it, the numbers seem very impressive compared to the global trend of cases and casualties, however, we feel that the numbers might be under-reported amid low transparency on the number of tests.

Unsurprisingly, Vietnam’s economy is feeling the full brunt of COVID-19. The Vietnam Manufacturing Purchasing Manager Index (PMI) tumbled to 32.7 in April from 41.9 in March. This is a consecutive third month of decline, implying massive contraction in business and economic activities. In April, the Index of Industrial Production (IIP) plummeted 10.5% Y/Y while estimated retail sales of consumer goods and services decreased by 26% Y/Y. Trade also witnessed a slowdown and initial numbers suggest a trade deficit of USD 700m in April. Exports stood at USD 19.7bn (fell by 18.4% M/M) while imports were USD 20.4bn (down 7.9% MM). The trade balance during the first four months of 2020 remains in surplus of USD 3bn. Disbursed FDI contracted 17.6% Y/Y to USD1.3bn in April, however, new-registered FDI posted an increase of 39% Y/Y, mainly represented by an additional investment of USD 1.4bn for the Long Son Petrochemicals Complex (LSP) in Ba Ria Vung Tau. April CPI decreased by 1.54% MoM and April CPI came down to 2.93%, largely driven by a lower gasoline price (-19.56% YTD).

Vietnam is an important trading and tourist destination and one should expect repercussions of lockdowns and less travelling. During the first four months of 2020 international visitors to Vietnam reached 3.7 million (falling 38% Y/Y) while only 26,200 international arrivals were reported in April, down 94% M/M and 98% Y/Y. We expect economic activities and travelling to pick up post May 2020 and full swing activities should be visible in the second half of the year.

Capital invested in a fund may either increase or decrease in value and it is not certain that you be able to recover all of your investment. Historical return is no guarantee of future return. The state of the origin of the Fund is Sweden. This document may only be distributed in or from Switzerland to qualified investors within the meaning of Art. 10 Para. 3,3bis and 3ter CISA. The representative in Switzerland is OpenFunds Investment Services AG, Seefeldstrasse 35, 8008 Zurich, whilst the Paying Agent is Società Bancaria Ticinese SA, Piazza Collegiata 3, 6501 Bellinzona, Switzerland. The Basic documents of the fund as well as the annual report may be obtained free of charge at the registered office of the Swiss Representative.

Restaurant in Ho Chi Minh City, empty even after relaxation in lockdown.

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