Major funds of VietFund Management (VFM) – the largest local fund management company – have been shrinking due to the COVID-19 outbreak, with some even falling by 20 per cent since the beginning of the year.
|VFM could not avoid the hit from the epidemic |
The local stock exchange has experienced much unhappiness because of the US-China trade war, tensions among powerful countries, and especially the global COVID-19 pandemic.
The VN-Index ended the session on March 12 at 769.25 points, down 19.95 per cent against late last year. The sudden hit in the first quarter has negatively impacted investors, particularly big funds because of their inability to restructure investment portfolios in time.
The latest reports published by securities companies showed that the VND7 trillion ($304.35 million) VFM could not avoid the shock, with most of its investments losing value, following the general trend on the stock exchange.
Its biggest fund – VFMVN30 ETF (code: E1VFVN30) worth VND5.7 trillion ($247.83 million) on March 12 saw a decline of 18.21 per cent in net asset value per share (NAVPS). VFMVN30 ETF is the second-largest exchange-traded fund in Vietnam (behind VNM ETF) that applies the reference index VN30. That is also the reason behind its recent plunge.
Meanwhile, VFMVF1 with the investment scale of VND414 billion ($18 million) also saw NAVPS reduce by 16.18 per cent compared to the beginning of the year. The other VFM fund, the VND99 billion ($4.3 million) VFMVF4 recorded a slash of 20.21 per cent, worse than the VN-Index’s 19.95 per cent decrease.
On the other hand, VFMVSF and VFMVFC fared somewhat better in NAVPS, falling 13.75 and 2.12 per cent, mainly due to their focus on debt securities and certificates of deposit. Nevertheless, their investment scales are smaller, about VND35 billion ($1.5 million) and VND2.5 billion ($108,700), respectively.
Thanks to specialising in bonds, VFMVFB reported the best performance with a NAVPS growth of 2.02 per cent. As the securities market is heading into a painful recession, bond funds will be safer for investors.