Limited market depth, access hurdles could cloud the party for Vietnam market’s FTSE upgrade

[HO CHI MINH CITY] Vietnam’s much-awaited upgrade to Secondary Emerging Market status by FTSE Russell may have sparked excitement among investors hunting the next growth story but beneath the buzz lies a few roadblocks from thin liquidity beyond a handful of blue chips to a scarcity of new listings.

Limited global broker access compounded by weak English-language disclosures and the absence of a central clearing counterparty (CCP) is another factor that could stand between Vietnam and the significant institutional inflows it hopes to attract.

“The issue is that outside the top 30 names, it’s difficult to put US$50 million (in each stock). There is no depth,” said Maybank Securities Thailand’s Pon Van Compernolle.