Securities companies maintains buy status in October despite market decline

Tuesday, Nov 06, 2018 18:39

Proprietary trading (the firm invests for its own profit instead of earning commission by trading on behalf of its clients) still generates large revenue for securities companies. — Photo

Securities companies remained net buyers in October despite a strong market decline.

According to Stockplus statistics, securities firms purchased 90.6 million shares worth VND3.8 trillion (US$163 million) in October while selling more than 92.3 million shares for VND3.77 trillion. They were net sellers in terms of volume by 1.7 million shares but still net bought more than VND36.4 billion.

This was a positive sign given that foreign traders continued to offload shares when the stock market plunged in October.

On the Ho Chi Minh Stock Exchange, the VN-Index lost about 10 per cent in October while the HNX-Index on the Ha Noi Stock Exchange also gave up 9.4 per cent.

Excluding unexpected trading from Masan Group, foreign investors ended October as net sellers with total value of more than VND2 trillion ($92 million).

The PAN Group (PAN), FLC Faros Construction (ROS), fund certificate E1VFVN30 and steelmaker Hoa Phat Group (HPG) were among the most active shares among securities firm with net buy value between VND45 billion and VND147 billion for each share.

On the other side, private conglomerate Vingroup (VIC) was the most offloaded with net sell value of over VND335 billion, followed by Ho Chi Minh City Infrastructure Develoment (CII), Eximbank (EIB) and VPBank (VPB) with net sell value of between VND100 billion and VND200 billion each.

Ending October, proprietary trading of securities companies had total net sell value of VND755 billion. This is in line with market development since the beginning of this year with the VN-Index losing 7 per cent and the HNX-Index decreasing 10 per cent.

Proprietary trading still generated large revenue for securities companies.

In the third quarter alone, profits, which are shown in the financial assets at fair value through profit or loss (FVTPL) indicator of 34 securities companies in the market, reached nearly VND1.4 trillion, up 14.8 per cent against the same period of last year and accounting for a large proportion of total revenue of many brokerage firms.

In the leading securities firms like Saigon Securities Inc, Ho Chi Minh Securities Corp and VNDirect Securities JSC, profits generated from investing in stocks were big.

SSI earned profits of VND277 billion from investing in Viet Nam Electrical Equipment JSC (GEX), VND251 billion from Dabaco Group (DBC) and more than VND118 billion from Hoa Phat Group (HPG).

In October, securities companies also increased trading on the derivatives market, up 64 per cent in volume and 35 per cent in value against the previous month. — VNS



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