How to invest in a volatile Vietnamese stock market

After a strong recovery from the market bottom of 2025 on April 9, the VN-Index has entered a correction phase, with six out of eight sessions showing declines between June 4 and Friday, June 13.

The Vietnamese stock market has seen significant fluctuations in the first half of 2025. These were driven by external factors such as the U.S. government's reciprocal tariff policy and, most recently, geopolitical tensions between Israel and Iran.

One seasoned investor, who declined to be named, commented' "The VN30 group has remained relatively stable thanks to the Vingroup family's stocks (VIC, VHM, and VRE). However, with these stocks starting to decline and no other groups of stocks strong enough to take the lead, the VN-Index is likely to adjust."

Looking at the broader picture since the beginning of the year, real estate has been the standout sector, with a notable double-digit gain. Data shows this group has increased by 40.4%, driven primarily by VIC and VHM, which surged 110.85% and 71%, respectively.

The Vingroup group’s influence is so dominant that, excluding its stocks, the VN-Index would currently hover around just 1,280 points.

Diversifying the stock portfolio

The recent six declining sessions highlight the market’s unpredictability, but they also open the door for potential buying opportunities.

Nguyen The Minh, director of analysis at Yuanta Vietnam Securities, advises that investors could consider buying stocks with solid long-term prospects that haven’t yet surged too much. However, he cautions that attention should still be paid to external risks, particularly the U.S. tariff policies.

Minh emphasized patience, especially for individual investors: "Even stocks like VIC and VHM required a long accumulation period to see strong growth in 2025."

Similarly, Pham Le Duy Nhan, director of investment portfolio management at Vietcombank Fund Management (VCBF), noted during the Financial Street talk show that both domestic and global markets have experienced substantial volatility in recent years.

This, he said, makes short-term investing highly risky - with the potential for significant capital losses when overly concentrated in a few stocks or forced to sell during market panics.

"Investors should allocate funds to companies with attractive valuations relative to their growth potential and strong management. Second, maintain a long-term investment perspective. Third, diversify across high-quality stocks. VCBF's strategy is not to panic when the market panics and not to get too excited when the market is excited," Nhan recommended.

He also emphasized that during major macroeconomic shifts such as the Covid-19 pandemic, the turbulence of 2022, or the recent tariff threats, investors should avoid trying to time the market or making knee-jerk sell-offs.

Instead, they should focus on re-evaluating individual holdings and restructuring their portfolios. Priority should be given to companies with stable profits, consistent cash flow, and the resilience to recover quickly when the market bounces back.

From a more cautious viewpoint, a veteran investor shared, "At this stage, it’s important to avoid FOMO (fear of missing out), maintain stock exposure at a balanced level - around 50% - and focus on preserving gains. Wait for a clearer market trend before making larger moves. Any new purchases should be short-term and follow strict take-profit and stop-loss strategies to minimize risk when the overall trend remains uncertain."

This investor also noted that capital flows will likely be selective, favoring sectors that are not negatively impacted by tariffs and that stand to benefit from government support and deregulation.