Net outflow of exchange-traded funds (ETFs) from ASEAN markets in the first quarter of 2020 reached US$283 million, VNDirect Securities Corporation (VNDS) has estimated.

The figure accounts for 3.7 per cent of total net sell value made by foreign investors across emerging and frontier markets in the region, the Ha Noi-based brokerage said in a report.

The net ETF outflow from Viet Nam ranked fourth out of five markets with the value of $41 million. The four other markets are the Philippines, Thailand, Indonesia and Malaysia.

But the percentage of ETF flow over foreign traded value in Viet Nam was 10.3 per cent, the highest among five markets.

“This could be due to the fact that ETFs are a favoured investment product in Viet Nam, with the value of funds pouring into Viet Nam from the first quarter of 2017 to the fourth quarter of 2019 over market capitalisation being at the top of the region (0.55 per cent),” VNDS said.

According to VNDS, total ETF inflow in the 2017-19 period in Viet Nam reached $540 million, the highest among five ASEAN markets. The region’s total value was $1.58 billion.

But the Vietnamese market capitalisation was only $97.9 billion as of March 31, 2020 – the lowest among five markets and far behind the four others.

In the first quarter of 2020, Viet Nam-focused ETFs – VN30 ETF, VNM ETF, FTSE ETF and Premia VN ETF – withdrew a total of $47.4 million from the domestic market, VNDS said.

In the first three month period, net asset value of Viet Nam-focused foreign ETFs had “a sharp average decline of 29 per cent year-to-date amid market turmoil” as the market went through a rough time amid the spread of COVID-19 and its impact on the global economy.

Foreign ETFs managed a total of $373 million worth of assets as of April 6, 2020, comprising mainly blue-chip stocks such as conglomerate Vingroup (VIC), dairy producer Vinamilk (VNM) and residential property developer Vinhomes (VHM). — VNS