Illustrative photo (Photo: cafef.vn)

Hanoi (VNS/VNA) - Most investment funds in Vietnam’s equity market have recorded modest gains and were beaten by the growth of the benchmark VN-Index in the past three quarters.

At the end of September, the benchmark VN-Index on the HCM Stock Exchange gained total 3.34 percent from its 2017 end of 984.24 points.

The large-cap VN30 Index, which represents the group of large-cap stocks with the greatest impact on the movement of the market, was up nearly 2 percent during the nine months.

Investment funds reported their growth rates had been outpaced by the banking system’s one-year saving rate, which is around 6.6 percent, data on cafef.vn showed.

Among foreign-owned investment funds that out-performed the VN-Index in the first nine months, the best-performing was the Sweden-based Tundra Vietnam Fund with growth rate of 12.2 percent.

Funds with similar performances were followed by others such as Singaporean fund LionGlobal Vietnam Fund (9.1 percent), British fund Dragon Capital VEUF (4.9 percent) and Korean fund KIM Vietnam Growth Equity Fund (3.4 percent).

The funds with growth rates lower than that of the VN-Index included UK-based FTSE Vietnam ETF (3 percent), Dragon Capital VEIL (1.4 percent) and JPMorgan VOF (0.8 percent).

Two foreign funds that recorded negative growth rates were Pyn Elite Fund (-0.7 percent) and VNM ETF (-3.4 percent).

Among local funds, Saigon Securities Inc’s SSIAM VNX50 ETF had the best growth rate (7.3 percent), followed by Thien Viet Securities JSC’s TVAM TVGF1 (6.1 percent).

Techcom Capital TCEF and another fund of SSI – SSI SCA – were the two local funds that recorded negative growth rates (-10.7 percent and -0.9 percent, respectively).

Other funds such as VCBF-BCF of Vietcombank, VinaCapital VEOF and VNDirect Securities JSC’s VNDirect Active Fund had their growth rates beaten by the growth of the VN-Index.

The reason investment funds were out-performed by the VN-Index was that those funds had not invested much in shares of property developer and retailer Vingroup, the largest company by market capitalisation, according to cafef.vn.

Vingroup shares, listed on the HCM Stock Exchange as VIC, grew by 27 percent in nine months and were among the driving factors for the growth of the stock market.

Meanwhile, the volatility of the USD/VND exchange rate is another factor that has been causing problems for investment funds in making investment in local stocks.

The daily reference exchange rate set by the State Bank of Vietnam for trading of foreign currencies in the country rose around 1.3 percent in nine months to 22,714 VND for a dollar.

The increase of exchange rate encourages foreign investors to sell local stocks to earn profits on the difference between the US dollar and the Vietnamese dong, thus, resulting in the outflow of foreign capital in Vietnam, analysts have said. –VNS/VNA