Index looks back on first year
|Investors praise the quality of the VN30 which tracks the top 30 shares by market capitalisation and liquidity on the HCM City bourse. — VNA/VNS Photo Tran Viet
HA NOI (VNS)— As March has begun, the VN30 Index concluded its first year of operations.
The index, which tracks the performance of the HCM City Stock Exchange's 30 leading shares, had a growth rate of around 26 per cent last year - one of the highest in the world.
According to the exchange, this growth was 1.43 times higher than the increase in the benchmark VN-Index.
As of January 31, the VN30 hit over VND578 trillion (US$27.5 billion) in capitalisation, accounting for nearly 74 per cent of the exchange's value.
After only one year, the index is already widely respected for its indications of blue chips' movements, as well as trends in the stock market as a whole.
"Investors have praised the quality of listed stocks in the VN30, over half of which grew more than the market average," said the exchange's president Tran Dac Sinh. "The International Finance Corporation gave VN30's shares higher scorecards last year."
The index helped enterprises enhance their liquidity, transparency and business performance and increase intangible assets, he said.
It also attracted foreign investors, as most of the funds operating within the country chose to invest in VN30's selected stocks.
"We plan to create our first exchange-traded product based on the index," Sinh said.
In addition, the market needed more indices to serve different demands, said Professor Tran Hoang Ngan, president of the VN30 committee. He recommended broader indices, such as those for specific sectors or groups of companies with common characteristics.
"Many investors care about small-cap stocks. The exchange could create an index for them," said Dragon Capital's portfolio manager Le Yen Quynh.
By the end of last year, the legal framework for the restructuring of the market was nearly complete.
"We will continue to work with the HCM City and Ha Noi stock exchanges in raising listing standards and strengthening corporate governance," said Vu Bang, chairman of the State Securities Commission.
"Many listed companies have the opportunity to be selected for the VN30," he added. — VNS