Vietnam Wealth Management Forum 2019 - Exclusive Insights - Rainer Michael Preiss

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1. Is there enough market depth and liquidity in Vietnam?

Video transcript

1. Is there enough market depth and liquidity in Vietnam?

Historically, liquidity has been constrained in this market. But now I think, with the US China trade war and potentially the upgrade from frontier market status to emerging markets status, increasingly it's a political will and a government decision to increase and jumpstart liquidity. For example, we recently opened the futures markets, board market is not coming in Vietnam, so a lot of these things put together mean that liquidity is growing. And, again, it's just about having the political will at the end of the day, because if certain things would change, then I think the flood gate would be open. So, for private investors, also more technical investors, now could be a nice sweet spot before that (market status) upgrade, maybe now is a time to position yourself because there's liquidity. It's still in some instances challenging, but potentially could pick up meaningfully once the government really decides to move ahead with that. And that, in my view, is partly driven by these new geopolitical realities, that Vietnam, increasingly, is seen as part of that US supply chain solution to the trade war with China. All these things come together. I mean, just the concrete example, Vietnam Airlines just received lending rights to the US for the first time ever. So, a lot of these are happening all in preparation for making Vietnam more investible and increasing it to bigger scale. So, the liquidity in the capital market, in my opinion, will grow on the back of that.

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