Gold is at its peak, why is money pouring into stocks?

Gold prices hit a new peak last week, but cash flow is concentrated on the stock market as the VN Index hit a record high.

Gold increased sharply but stocks made more profit

At the end of yesterday, August 11, the price of SJC gold bars was bought at 122.7 million VND/tael and sold at 123.9 million VND, a slight decrease compared to the peak selling price of 124.4 million VND/tael last week. At the current level, gold bars have increased by over 39 million VND/tael compared to the beginning of the year, an increase of 46%. Similarly, SJC listed gold rings for buying at 116.6 million VND and selling at 119.1 million VND/tael, an increase of about 40% compared to the beginning of the year. After deducting the difference between buying and selling prices of 2 - 2.5 million VND/tael, if you buy gold bars from the beginning of the year, you will still have a profit of nearly 45% - a very high profit compared to bank savings interest rates which still fluctuate from 5 - 5.8%/year.

The stock market continuously sets new records, attracting strong cash flow participation.

PHOTO: NHAT THINH

Domestic gold prices set a new record last week when the international precious metal hovered near the threshold of 3,400 USD/ounce and then turned down to 3,359 USD/ounce. However, this is still a record high for world gold. The main driving force for gold prices to remain high is the demand for safe havens still existing in the context of US President Donald Trump officially imposing tariffs on many countries and weak US employment data making investors expect the US Federal Reserve (Fed) to soon lower interest rates. Lower interest rates may impact the USD and gold prices.

Along with the increase in gold prices, a series of stocks had a "huge" increase. Closing yesterday's trading session, VN-Index set a new record when it reached 1,596.86 points after increasing by 11.91 points. At one point in the session, VN-Index even reached the threshold of 1,600 points for the first time in the history of the Vietnamese stock market. Compared to the beginning of this year, the VN-Index increased by 26%. However, a series of stocks have increased by 50 - 100%. Compared to the beginning of April after a sharp decline, up to now, a series of stocks have increased by 2 - 3 times. It can be mentioned that the group of stocks in securities, real estate, banking, retail... all increased simultaneously. Even blue-chip stocks that were thought to be difficult to increase also doubled, such as VIC from 58,000 VND to 117,000 VND; SSI increased from 20,600 VND to 37,500 VND; Raw materials increased from under 10,000 VND to over 18,000 VND...

Notably, along with the increase in prices of stocks and stock indices, the cash flow traded on the stock market has reached an unprecedented high. On the HOSE floor, the last session of July had a trading value of nearly 72,000 billion VND for the first time. In the whole market, liquidity exceeded 80,000 billion VND - a number that has never appeared in the history of trading on the Vietnamese stock market. Excluding this session of liquidity explosion, the trading value has continuously remained at over 50,000 - 60,000 billion VND throughout nearly 10 trading sessions in early August. The trading value shows the excitement and optimism of stock investors, which is higher than in the first half of the year.

Domestic gold prices also hit a new peak but trading was sparse.

PHOTO: NGOC THANG

Stocks attract a lot of money

Although the price of gold has been increasing continuously, trading in the market has been quite weak. Even on forums, articles, comments and forecasts about gold prices are sparse. For example, the group "Vietnam Gold Forum" on social networks with nearly 200 members, in 2024 there were dozens of articles and lively discussions every day, but in July there were only 2 posts from the administrator and in the previous June there was absolutely no information; in August, there was only one post from the administrator every 3-4 days. Meanwhile, the stock market maintained trading sessions of over 2 billion USD per session.

According to investment finance expert Phan Dung Khanh, recently few people are interested in gold even though the price is still increasing. Many individuals who last year still boasted that they had bought gold to accumulate and had the right profit recently asked him for his opinion on which stocks to buy. The reason is that although gold has increased sharply, the rate is not high, especially in the second quarter of 2025. Meanwhile, the stock channel has increased sharply in July alone, attracting attention because any investment channel with high profits will attract many people. A series of stocks can increase by 25-30% in just 1 week to 10 days, becoming very attractive to individual investors. This trend will likely continue until the end of this year and into next year.

Expert Phan Dung Khanh analyzed: When the gold price is at its peak and to double, the world price must go up to 6,000 - 7,000 USD/ounce. This is a price that no one has predicted, so everyone knows that the possibility of high profits will not be much. Meanwhile, there is a lot of favorable information such as the high growth of Vietnam's economy ; the possibility of upgrading the stock market in the near future, so many "hot" stocks still have the ability to increase 2 - 3 times. The factors that have supported strong gold price increases in the past, such as the Russia - Ukraine conflict or even in the Middle East region, are also old stories. Even the trade tension due to President Donald Trump's tariff policy, which will strongly impact the economic story in general and the operations of many businesses in particular, has also been overcome. The recent strong cash flow into stocks will inevitably come from many sources, maybe partly from those who already hold gold.

Dr. Dinh The Hien, an economic expert, analyzed: From the past to the present, gold has often been an investment channel for ordinary people. For financial investors, the two most important channels are still prioritized: real estate and stocks. In 2024, when the price of gold increases, not all stock investors will switch to buying gold, but only a few people and also spend a small amount of money to surf the gold wave. With the real estate channel, everyone knows that it requires a large amount of capital while liquidity is lower than stocks. In its history, the stock market has always witnessed periods of strong growth, with strong cash flows, and when it declines, capital is withdrawn and transactions are few. In terms of size, the more the economy develops, the more the stock channel increases in the number of goods and participants.

However, Dr. Dinh The Hien said that the domestic stock market is still dominated by individual investors, so the cash flow on the stock exchange is unstable and not suitable for the goal of promoting the development of the stock market into a main capital mobilization channel for the economy.

Gold price on August 11, 2025

According to the latest report from SGICapital Fund Management Company, in July, the domestic cash flow into the stock market was very strong, continuously pushing the score and trading scale to new peaks. The belief in a strong GDP growth cycle of 8-10%/year, along with the upcoming upgrade time, in the context of low interest rates and the strongest public investment promotion in many years, is resonating to strengthen the confidence and optimism of investors, in contrast to 4 months ago when Vietnam was suddenly imposed high taxes by the US. The attraction of the stock market is recently attracting cash flows from many other investment channels such as real estate and cryptocurrencies. Along with the explosion of liquidity, the level of margin usage has also increased beyond the 2022 peak.

Source: https://thanhnien.vn/vang-len-dinh-cao-vi-sao-tien-o-at-chay-vao-chung-khoan-185250811200728401.htm