The International X MSCI Vietnam ETF was launched in December 2021. I think a part of the chance for this ETF to achieve success may need been primarily based upon how the VanEck Vietnam ETF has proven a poor file since inception method again in 2009.
Sadly nevertheless this new International X MSCI Vietnam ETF is mockingly off to a poor begin.
I can see how the ETF suppliers would possibly nonetheless see a great future for it although. There are various US buyers who search for a Vietnam ETF on the US trade and will not be fairly glad with the lengthy working VanEck Vietnam ETF.
On this weblog put up I’ll define the place this new International X MSCI Vietnam ETF would possibly slot in for some buyers, within the context of evaluating with the likes of the VanEck Vietnam ETF.
GLOBAL X MSCI VIETNAM ETF (VNAM) SUMMARY
- What index it tracks – The International X MSCI Vietnam ETF (VNAM) seeks to supply funding outcomes that correspond typically to the worth and yield efficiency, earlier than charges and bills, of the MSCI Vietnam IMI Choose 25/50 Index.
- Dimension – Roughly US $5.4 million as at August 31, 2022.
- Inception Date – 7th December 2021.
- Administration Expense Ratio (MER) – Roughly 50 bps.
- Dividend Yield – Roughly 0.23%.
- Common Day by day Quantity – Roughly 3,300 shares, or circa $55k value.
- Prime 5 holdings – Vinhomes , Vingroup, No Va Land, Hoa Phat Group & Masan Group, these 5 complete about 37% of the fund at October 6, 2022.
Supply: globalxetfs.com
GLOBAL X MSCI VIETNAM ETF (VNAM) HOLDINGS
GLOBAL X MSCI VIETNAM ETF (VNAM) PERFORMANCE
Supply: globalxetfs.com
GLOBAL X MSCI VIETNAM ETF (VNAM) SECTOR EXPOSURES
PROS N CONS OF GLOBAL X MSCI VIETNAM ETF (VNAM)
PROS
- Comfort of buying and selling on the US market.
- The MER is decrease than one other standard ETF amongst its friends, i.e., 50bps relatively than 60bps.
- The index development methodology implies that there are limits to how concentrated it turns into (i.e., The load of the biggest firm within the Index is capped at 25%. & The combination weight of all corporations representing greater than 5% of the Index can’t exceed 50%.). ETF buyers typically are likely to desire this extra diversified method.
- Likewise as a result of above index development methodology, ETF buyers might desire that this offers the product extra publicity to the mid / smaller finish of the Vietnam inventory market compared to a few of its friends.
CONS
- Low quantity mixed with bid ask unfold of circa 70 bps
- Quick historical past, low AUMs, will the product final within the very long run?
- Like different Vietnam ETFs they could effectively underperform many lively Vietnam managed merchandise, there doesn’t appear to be robust arguments to recommend in any other case. I’ve coated this side on numerous weblog posts on this web site.
- VNAM ETF doesn’t have the identical entry to Vietnam listed shares which are close to their overseas possession limits (FOLs), not like many Vietnam listed ETFs.
VNAM VS VNM ETF COMPARISON FOR VIETNAM ETFS
| VNAM | VNM | |
| MER | 50bps | 59bps |
| VOLUMES | low volumes traded | better liquidity |
| O/S STOCKS HELD | all Vietnam listed shares | Just lately held 18% shares listed South Korea, Taiwan, Japan. |
| DIVERSIFICATION | 66 holdings, doubtless much less concentrated bigger positions. | 59 holdings and extra potential to have bigger bets on high positions. |
| MID / SMALLER COYS HELD | Extra prone to maintain a bit extra publicity to mid / smaller Vietnam listed corporations. | Much less prone to maintain smaller Vietnam listed corporations. |
VIETNAM ETF RESEARCH
If you wish to study extra about components like lively vs passive in Vietnam, overseas possession limits (FOLs), totally different Vietnam ETF constructions, and so on I like to recommend these different weblog posts of mine beneath:
COMPLETE LIST OF ALL THE VIETNAM ETFs
Beneath you’ll get an understanding why there was robust progress in Vietnam listed ETFs. Additionally, you will recognize how overseas possession limits (FOLs) are an essential concern for Vietnam buyers.
COMPLETE LIST OF ALL VIETNAM ETFs
VIETNAM STOCK MARKET CRASH 2022
Only some days in the past the Vietnam inventory market was making headlines for being one of many world’s worst performers over the past month because it confirmed falls of round 18% in such a brief house of time.
It has not gone unnoticed by me that the Van Eck Vietnam ETF (VNM) listed in August 2009. Maybe the thought to get the product going was made through the bull market a few years earlier? While the timing may have been worse in the event that they launched proper earlier than the Vietnam inventory market crashed in 2008, it was nonetheless fairly difficult because the Vietnam market struggled the primary couple of years of this ETF round 2009-2011.
That has not helped the long run efficiency of the Van Eck Vietnam ETF (VNM), which reads poor as I’ve mentioned beforehand on the weblog.
It’s considerably ironic then that this new GLOBAL X MSCI VIETNAM ETF (VNAM) most likely additionally was an idea considered through the increase Vietnam inventory market years of 2020-21, solely to launch simply earlier than the large bear market of 2022! They could have thought an edge for his or her product can be to generate significantly better efficiency numbers since inception date in contrast with the lengthy historical past of the Van Eck Vietnam ETF (VNM). Nonetheless as we are able to see from their preliminary efficiency I posted earlier as much as September 2022, it’s off to a disappointing begin!
Possibly the important thing message right here is watch out for the market when the advertising gurus are developing with new ETFs for it.
SHOULD I BUY THE GLOBAL X MSCI VIETNAM ETF (VNAM)?
If an investor was solely limiting themselves to the well-known Vietnam ETFs that commerce on the US trade right here just like the Van Eck Vietnam ETF (VNM) and the GLOBAL X MSCI VIETNAM ETF (VNAM), the latter comparatively new ETF product affords some meals for thought.
In case you are annoyed by the lengthy working VNM ETF and it holding a sizeable publicity to shares listed on exchanges resembling Japan, South Korea, Taiwan and so on, (commonplace to be shut to twenty%), then the brand new GLOBAL X MSCI VIETNAM ETF (VNAM) could be extra appropriate for you.
Nonetheless I might warning in regards to the low AUMs and liquidity, my feedback above confer with these buyers that desire to purchase and maintain for a few years.
There may additionally be a small danger that the product doesn’t achieve traction and it doesn’t final for the long run, that means you would possibly then have to exit at an undesirable time on your circumstances.
Not less than they’ve launched one thing with a decrease MER even when the timing has not but been good. For these Vietnam inventory market publicity proper now although, given the large battering of their market over the past month, I think the long run returns needs to be fairly strong within the GLOBAL X MSCI VIETNAM ETF (VNAM) if measured from the time I’m writing now.
VIETNAM CLOSED END FUNDS
I’m nonetheless of the view nevertheless that regardless of their larger charge constructions, Vietnam closed finish funds are prone to proceed to outperform the Vietnam ETFs I’ve simply mentioned.
For these eager to learn extra about these CEFs, you’ll be able to learn the beneath hyperlink the place I reviewed the choices accessible final yr.
vinacapital vietnam alternative fund assessment
One CEF as talked about within the above heading I not too long ago did an in-depth assessment for the Searching for Alpha web site. It might or is probably not paywalled relying on one’s free article restrict I’m not positive, however right here it’s anyway..
VinaCapital Vietnam Opportunity Fund – Buy The Dip | Seeking Alpha
VNM ETF REVIEW
Equally, I additionally did an in-depth assessment on the VNM ETF, Searching for Alpha hyperlink beneath:
The VanEck Vietnam ETF: Performance Review (BATS:VNM) | Seeking Alpha
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This web site represents my opinions, which can not replicate these of Searching for Alpha, and doesn’t represent an funding suggestion or recommendation.
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