Many investment funds recorded large losses in 2022, but they are restructuring their portfolios, expecting long-term opportunities.
Despite the profit in November 2022, the net loss since the beginning of 2022 of VEIL, the largest fund of the Dragon Capital fund group, was still larger than the decrease of the VN-Index. Although recording a rate of return of 2 per cent in November, in the first 11 months of this year, VEIL reported a negative rate of return of 37.35 per cent, higher than the decrease of 35.3 per cent of VN-Index.
VEIL started to net sell from the end of September to the beginning of November, bringing the proportion of cash from US$14.2 million to nearly $200 million.
After raising the proportion of cash to a record of 13.81 per cent in the second week of November, equivalent to more than $198 million, as of December 1, 2022, VEIL's cash proportion decreased to only 5.62 per cent. This shows that the fund actively disbursed in the context that the market was in the first stage of recovery after bottoming in mid-November.
It is estimated that from November 10 to December 1, 2022, VEIL disbursed more than $123 million, making it one of the most active net buying investment funds in the market.
One of the notable transactions was the net purchase of 9.75 million Khang Dien House (KDH) shares by VEIL of Khang Dien Housing Trading and Investment Joint Stock Company, bringing the holding volume to 10.75 million shares. It net bought 50,000 DGC shares of Duc Giang Chemical Group Joint Stock Company, raising the ownership rate to 7.17 per cent.
In contrast, since the beginning of 2022, VEIL has continuously net sold HPG shares of Hoa Phat Group Joint Stock Company. As of November 3, HPG is no longer in the Top 10 largest investments of the Fund. However, in the latest report, HPG returned to the Top 10 in the portfolio and accounted for 4.01 per cent of the total net asset value (NAV) of nearly $1.4 billion.
As of December 1, 2022, the banking group still accounted for the largest proportion of VEIL's portfolio, with 33.98 per cent, followed by real estate (20.83 per cent), and food and beverage (9.14 per cent).
According to the latest report of PYN Elite, 2022 is a more difficult year than predicted. As of December 15, VN-Index fell 29.8 per cent and the rate of return of PYN Elite was negative 24.7 per cent. The decline of the Vietnamese stock market is not in line with other markets in the ASEAN region, so there will be a chance to bounce back.
“Confidence in the market improved. We expect that VN-Index will move in sync with Viet Nam’s economic growth. Among ASEAN countries, Viet Nam has the strongest prospects for economic growth and corporate profits,” said PYN Elite.
Foreign investors took advantage of the opportunity to buy Vietnamese stocks when the price dropped deeply. In November 2022 alone, this group bought a net of $685 million, a record number.
“Thanks to new investment inflows and a strengthening euro, we have the opportunity to buy stocks at the bottom with cash reserves. We have built a new position with the banking group, which now accounts for 9 per cent of the fund's portfolio,” said PYN Elite. As of the end of November 2022, the net asset value (NAV) of PYN Elite was 671.4 million Euro.
Although optimistic about Viet Nam's economic prospects, there are some sectors that will face many difficulties in 2023 such as real estate and related industries, including construction and building materials. Tight monetary policy will reduce demand for real estate in the short term, even if the economic outlook is bright, said AFC Vietnam Fund.
The area where AFC Vietnam Fund is holding a large proportion in the portfolio is insurance, with the view that the insurance group has a lot of cash, benefitting from the environment of rising interest rates. Specifically, a higher interest rate environment will positively affect the profits of insurance companies, because deposit interest can contribute up to 80 per cent of the profits of these businesses. Besides, the tourism industry is also a beneficiary group, when the number of international visitors increases and China reopens.
Net asset value (NAV) of AFC Vietnam Fund grew positively in November 2022 with an increase of 1.3 per cent, reaching $51.5 million. In 11 months, NAV decreased by 23.5 per cent, while VN-Index decreased by 35.3 per cent.
At the end of October, AFC Vietnam Fund's cash ratio was 2.7 per cent.
Talking about investment opportunities in the near future, AFC Vietnam Fund said Viet Nam is one of the fastest growing economies in the world, GDP is expected to increase by 8 per cent in 2022 and 6 per cent in 2023. However, The stock market's recent decline has brought the market valuation to an attractive level, said AFC Vietnam Fund. — VNS