Vietnam's securities market officially upgraded

Early morning of October 8, Vietnam time, right after the US stock market closed the trading session on October 7, FTSE Russell announced the National Stock Classification Report for September 2025.

Vietnam has been officially upgraded from a frontier market to a secondary emerging market, after more than a decade of comprehensive reforms. FTSE Russell expects the upgrade to take effect on September 21, 2026, following a mid-term review in March 2026.

Vietnam meets all emerging market criteria for market upgrade

In the report, FTSE Russell said this review focused on examining Vietnam's progress in expanding trading capabilities through global securities companies - an important factor for international investment funds to simulate the index.

Previously, Vietnam failed to meet two technical criteria including payment cycle (DvP) and transaction error processing costs. However, since November 2024, Vietnam has deployed the Non-Pre-funding Solution (NPS) transaction model, allowing foreign institutional investors to purchase shares without having to deposit sufficient funds in advance. Along with that, a payment error transaction processing process has also been established, making the system operate more transparently.

"The FTSE Russell Index Management Board (IGB) recognises Vietnam's progress in improving its market and confirms that Vietnam meets all the criteria for secondary emerging market status," the announcement said.

FTSE Russell recognized the efforts of Vietnamese regulators in upgrading trading infrastructure, allowing foreign institutional investors to trade directly with global securities companies, thereby reducing counterparty risks and increasing market reliability.

However, the organization also noted that access to international brokers in Vietnam is still limited. Although not a mandatory condition for upgrading, FTSE believes that this is an important factor for the integration process to take place completely, helping the Vietnamese market to get closer to international standards in terms of openness and liquidity.

According to the plan, the upgrade will be implemented by FTSE Russell in several stages, linked to Vietnam's improvement progress. In the coming time, FTSE will continue to consult the international investment community and monitor the operation of the new mechanism before the review in March 2026, ensuring the official upgrade in September 2026.

This is considered a historic milestone for the Vietnamese stock market, recognizing more than 10 years of reform efforts in the legal, technological and trading standards fields, bringing Vietnam closer to the group of true emerging markets.

According to securities companies, the upgrade could help Vietnam attract a net 6-8 billion USD, or even up to 10 billion USD in a positive scenario, including both active and passive capital flows.

Many experts believe that real estate stocks could be one of the sectors that benefit the most from Vietnam being upgraded by FTSE Russell. As foreign capital flows increase sharply, businesses with large land funds, financial transparency and the ability to implement substantial projects will attract foreign investors.

The real estate sector often leads the rally thanks to expectations of improved liquidity and asset revaluation. In Vietnam, large-cap stocks such as VIC, VHM, NVL, KDH, DXG… are expected to be included in the FTSE Emerging Markets Index basket, thereby directly benefiting from passive capital flows.

However, analysts also warn that short-term price increases can create strong fluctuations, especially in stocks with high speculative factors. Investors are advised to choose businesses with solid financial foundations and realistic projects to avoid risks when the market corrects after the euphoric period.

Being recognized as a secondary emerging market by FTSE Russell not only affirms the position and maturity of the Vietnamese stock market, but also opens the door to attracting global capital flows. This is the result of more than a decade of reform, laying the foundation for the Vietnamese market to rise to the regional level and increase its attractiveness in the eyes of international investors.

FTSE Russell is one of the three leading prestigious organizations in the world in the field of building and managing stock indexes, along with MSCI and S&P Dow Jones Indices. The indexes developed by FTSE Russell are widely used globally, serving the needs of investment funds, financial institutions, banks and large asset managers. FTSE Russell divides the global stock market into four levels: developed market (Developed), advanced emerging (Advanced Emerging), secondary emerging (Secondary Emerging) and frontier (Frontier). This organization currently ranks 13 countries in the secondary emerging market group, including many Asian economies such as China, India, Indonesia, the Philippines and Qatar.

Source: https://dantri.com.vn/kinh-doanh/chung-khoan-viet-nam-chinh-thuc-duoc-nang-hang-20251008050427611.htm