The outstanding balance of South Korean investments in Vietnamese stocks climbed 22.1% to $290.3 million as of Sept. 2, compared to the end of April, according to the Korea Securities Depository on Wednesday, reflecting growing optimism about the Southeast Asian country’s economy.
The ACE Vietnam VN30 ETF (Synth), the only domestically listed exchange-trade fund (ETF) tracking Vietnamese stocks, drove money inflows to Vietnamese stocks.
It attracted around 3.9 billion won ($2.8 million) from individual investors in August, a sharp reversal from net outflows in the previous three months, according to the KSD, South Korea’s sole securities deposit and settlement institution.
In the first two days of this month, an additional 1.4 billion won was channeled into the ETF comprised of Vietnam’s 30 blue chips. Launched in 2016, the ETF, managed by Korea Investment Management Co., has net assets of 302.7 billion as of Thursday.
The fund ranked as the 22th best-performing ETF on the Korea Exchange in August, posting a 15.67% gain as Vietnam’s main stock index, or the VN, soared 12% during the month.
This contrasts with the rangebound Korean stock market, which has hovered between 3,100 and 3,200 points since July.
Robust economic growth and reduced uncertainty over US tariffs gave a leg-up to Vietnamese stocks.
Its gross domestic product expanded 7.5% in the first half of this year, its fastest pace of half-year growth in 15 years.
The figure nearly reached the country’s full-year 2025 target of 8%.
Vietnam’s stock market has gained another boost from Ho Chi Minh’s economic stimulus measures and a tariff deal with the US, which cut levies on Vietnamese exports to 20% from 46%.
Investors are also betting on the country’s potential upgrade from frontier to emerging market status by FTSE Russell in its upcoming September review.
“Vietnamese stock market is expected to maintain its upward momentum through September or October, when a decision on its potential upgrade to emerging market status will be finalized,” said Kim Geun-ah, an analyst at Hanwha Securities.
“But we should brace for a downward correction after its steep uptick in such a short period.”
By Ji-Yoon Yang
yang@hankyung.com
Yeonhee Kim edited this article.
