Social distancing due to COVID-19 has created more local stock investors in Viet Nam, especially among internet-savvy young people.
According to data, there were 619,911 new accounts opened in the first six months of the year, an increase of 58 per cent compared to the first six months of 2020, which also registered a record number of new accounts.
As a freelance photographer, Nguyen Quang Anh, 24, in Lieu Giai Street, Ha Noi did not have a lot of work even before the social distancing orders were put in place.
Anh said the boredom of having to stay at home because of the social distancing order and fewer working opportunities led him to invest in the stock market with some investment-friendly and user-friendly applications.
Anh told Viet Nam News: "Being hit by the fourth wave of COVID-19 and with everything digitised, it is a good time to focus on investing. It is one of the few activities we can do when we must stay at home.”
With more money, Le Tuan Phong, 28, in Lang Ha Street chooses to invest in stocks and ETFs listed on the HCM City Stock Exchange (HoSE) via a prestige open fund.
Phong said a good fund would help him make bigger profits, however, he also wanted to invest by himself.
Phong told Viet Nam News: "It is not difficult to find information on social networks through financial investment groups and securities and digital currencies," adding the majority of investors were his age.
There are groups with hundreds of thousands of people, who update content and operate live streaming investment channels, sharing financial knowledge, and attracting a lot of followers.
Since last year, the number of investors on mobile apps has increased sharply. Local investment apps specializing in investments and stocks like Finhay and Infina are attractive to young investors.
Recently, Infina, announced an oversubscribed US$2 million seed round from Saison Capital, Venturra Discovery, 1982 Ventures, 500 Startups, Nextrans, and angel investors like executives at Google and Netflix.
Launched in January 2021, the app serves the investment demands of users between the ages of 25 and 40 with a minimum contribution of $25. Those investors can choose from assets including savings accounts, term deposits, fractionalized real estate and mutual funds.
At the launch of the app, the firm said only about 3.2 per cent of people in Vietnam had invested in stocks. That rate had increased thanks to a high internet penetration rate of more than 70 per cent.
Experts in the market said that the growth was largely contributed to the technology which allows investors to open an account online.
According to Dragon Capital Vietnam, a number of open-ended fund investors under the age of 35 on digital channels account for approximately 60 per cent of the total number of investors in Viet Nam.
The fund calculated that their average investment amount was surprisingly high compared to the average income in Viet Nam, at VND18 million ($782) per month.
They said the trend of investing through mobile technology will play a more dominant role in the market moving forward.
As a long-standing fund management company in Viet Nam with more than $5 billion in assets under its management, Dragon Capital Vietnam sees the future for investors in technology platforms.
On July 26 it introduced the DragonX investment application to the market, which is seen as a breakthrough for investment fund management in Vietnam. Together with the launch of DragonX, the fund also adjusted the minimum investment required to only VND100,000 while completely waiving the purchase fee to attract more investors.
DragonX provides users with investment knowledge in an easy to understand way through posts, daily newsletters and investment videos from the firm’s team of experts.
Tran Thanh Tan, vice Chairman of the Board of Directors of Dragon Capital Vietnam told local media: "I believe that a country's financial market can only develop strongly if there are a large number of local investors. DragonX is our way to bring people closer to good investment opportunities in the Vietnamese financial market.
Beware of tricks
Nguyen The Truyen, director of Thien Thanh Law Partnership, the City Bar Association, Ha Noi said with the internet environment, people can transact easily and some of them were too eager to pour their money into apps with the dream of "becoming a billionaire".
In April more than 1,800 people in HCM City were cheated of millions of US dollars by an investment platform app called Coolcat, which announced itself as an insurance investment firm with more than five years of experience headquartered in the UK. It then vanished taking with it all of the money of the app users in the city.
Truyen said being at home for long periods of time, people often find new things to try however investment is not easy. A 'quick money' mindset could lead them to be drawn into using fraudulent apps.
In early July, the leader of the State Securities Commission of Vietnam (SSC) announced despite COVID-19's complicated development, the local indexes continued to set new records, helping the stock market enjoy the second fastest growth rate in the world. — VNS