Maintain the upgrade roadmap, improve market access
At 3 am on April 8 (Vietnam time), FTSE Russell announced the mid-term review results within the framework of the March 2026 stock market classification review.
The announcement said that this organization acknowledged the important progress of the Vietnamese stock market, especially related to market access through global securities companies.
FTSE Russell officially confirmed to maintain the roadmap to upgrade Vietnam from the Frontier Market to the Secondary Emerging Market, according to the plan announced in October last year.
According to FTSE Russell's assessment, the issuance of Circular 08 of the Ministry of Finance has established a legal framework to ensure the accessibility of foreign investors to the Vietnamese stock market through global securities companies. At the same time, regulations related to the mechanism of non-pre-funding have also been improved.
Management agencies, domestic securities companies, global securities companies, custodian banks and international institutional investors have agreed on a deployment model according to these new mechanisms.
On that basis, the Board of Directors of FTSE Russell Index confirmed the upgrade roadmap of the Vietnamese market. The allocation of Vietnamese stocks to FTSE's index baskets will be officially implemented from September 21, 2026.
To ensure the transition process takes place stably and in accordance with market conditions, the inclusion of Vietnamese stocks in global index sets will be implemented according to a roadmap, starting from September 2026 and completing in September 2027.
Capital flow and market valuation are expected to improve
Assessing the impact of the stock market upgrade roadmap, Mr. Dinh Minh Tri - Director of Personal Customer Analysis, Mirae Asset Securities Joint Stock Company (Vietnam) said that after the upgrade, global capital will flow strongly into Vietnam. It is necessary to distinguish between the two main capital flows.
Accordingly, passive capital flows are forecast to enter first and be highly certain. ETF funds monitoring FTSE Emerging Markets will buy Vietnamese stocks at the time of portfolio restructuring. With being included in FTSE emerging market indices, Vietnam will have the opportunity to access capital flows from global investment funds.
Currently, there are about 28 stock codes identified as likely to enter the FTSE Emerging basket, in which large-cap stocks such as HPG, VCB, VIC, VHM are predicted to be the focus.
Meanwhile, active capital flows will arrive later and depend heavily on the completion of the central offsetting partner (CCP) mechanism. Large-scale investment funds need the ability to short sell, derivative transactions and reliable offsetting payment systems before large-scale disbursement. Therefore, many organizations expect this capital flow to be clearer in the 2027-2028 period.
Regarding market developments, according to Mr. Tri, upgrades can create two main effects.
The first is the revaluation effect. Currently, the P/E ratio of the Vietnamese market is about 15-16 times, lower than emerging markets equivalent to Indonesia (17-19 times) or the Philippines (16-18 times). When ranked in the same group, institutional investors tend to raise the target valuation level, thereby creating price increase pressure for the market.
Second is the reform effect. Maintaining the criteria of emerging markets will create continuous pressure forcing Vietnam to improve governance, transparency and market infrastructure, forming a positive feedback loop that is no less important than direct cash flow.
