VNX INDEXES FAMILY BRINGS TO INVESTORS
- A measure coherent with international standards that reflects Vietnam index performance
- Information with high transparence about how the index family is designed, selected and managed day to day
- Complete index data available for the investors research
- Tradable indexes that can serve as basis for structured products and other index-linked investment vehicles as response to the development of the Vietnam market
- This family proposes Benchmark indexes for giving a good measure of the total market evolution, Blue Chips indexes for building products and trading the basket easily, Sectors indexes for specialized sectors.
- The primary indexes are calculated in the Prices and Total Return versions. Each index is available in four currencies: EUR, JPY, USD and VND.
- The benchmark Indexes is designed in order to have the global performance of the VietNam stocks, and in each particular market (Ho chi Minh Stock Exchange, and the Ha Noi Stock Exchange).
- Also the VNX 300 Index will have 3 sub indices that divide the market in three groups in term of capitalization: Large, Mid and Small capitalizations.
- The design of these indices is described as following:
- Universe : All shares listed on the two markets HOSE and HNX (over 700 stocks) are eligible.
- Selection : The 300 largest companies in term of the capitalization are determined as it focuses on the liquid stocks (excluding stocks having less 10% of annual velocity or 50% of trading days)
- The Ho Chi Minh stocks in the VNX 300 sample constitute the VNX HSX index
- The Ha Noi stocks in the VNX 300 sample constitute the VNX HNX index
- From the sample of the 300 constituents of VNX 300, the 50 leading stocks in term of capitalization are selected and will represent the VNX Large 50 index.
- The VNX Mid 100 index comprises the 100 next-largest capitalizations after the 50 largest stocks that make up the VNX Large 50 index.
- The VNX Small 150 index is made up of the remaining 150 smallest capitalizations in the VNX 300 index.
- The VNX Large & Mid 150 index is composed by the stocks belonging the VNX Large 50 and VNX Mid 100 indexes.
- The VNX Mid & Small 250 index is composed by the stocks belonging the VNX Mid 100 and VNX Small 150 indexes.
INDUSTRY & SECTOR INDEXES
- After 10 years of trading, the VietNam stock market has now more than 700 listed stocks present in different industries and sectors.
- VNX Industries indexes comprehend 10 main industries:
In addition, 1 Super sector is calculated:
BLUE CHIPS INDEXES
- Blue Chips indexes are Tradable and are created respecting all the necessary international standards in purpose to be served as underlying instrument for the derivatives and other structured products.
- Stocks are weighted according to their free float market capitalization with a maximum weight of 15% per stock.
- The Blue chips VNX 50 index consists of 50 highest ranking stocks in term of free float capitalization and daily turnover average. The index reflects in the performance of the most representative stocks of the two markets HSX and HNX.
- Universe : The VNX Large & Mid 150 index
- Selection : These 150 stocks are ranked by the turnover average over the last 12 months and the free float adjusted capitalization. The first 50 combined ranked companies become the components of the VNX 50 index.
- The Blue chips VNX 25 index consists of 25 highest ranking stocks in term of free float capitalization and turnover of the VNX Large 50 index sample.
- Strategy indexes are developed in adapting some performant portfolio strategies in purpose to be served as underlying instrument for the derivatives and other structured products, IFRC INDEXES launches:
and especially for Electricity Group, 3 indexes are available:
Women CEO indexes
VNX WOMEN CEO Index is a second index in the world tracking listed companies which are managed by women CEO. Many academic and empirical research demonstrated the better performance of female corporate governance.
- The VNX PVN Plus 10 index combines leadership companies of PVN group and 5 other major sector industries. The index is designed for use by local and international investors, and therefore reflects the float available to residents, and is fully UCITS III compliant.
- The VNX Leaders 10 index serves as a investable benchmark to track, as a single asset class, the performance of 10 Vietnamese leaders across 10 industry sectors trading on the HSX and HNX stock exchanges
SMART BETA INDEXES
For the past 35 years, investors have had two choices: passive or active portfolio investment. If they believed markets were largely efficient, they chose to invest through capitalization-weighted index funds. If they believed markets were inefficient, they picked active management.
But both approaches are inherently flawed. Both approaches have their problems:
- Capitalisation weighted equity index funds tend to overweight overvalued securities and underweight undervalued ones.
- Active management is not transparent, comes with high fees, and tends to underperform the benchmark over long time periods.
Smart beta strategies, such as non-price-weighted indices, offer an alternative choice.
These strategy indices retain the benefits of traditional capitalization-weighted indices, such as broad market exposure, diversification, liquidity, transparency, and low cost access to markets. At the same time, they offer the opportunity to achieve superior performance over the cap-weighted benchmark.
IFRC presents the Smart Beta indexes family:
- The VNX 25 High Dividend index consists of the 25 stocks from the VNX Large 50 Index with the highest realized dividend yield over the past 12 months. Constituents are weighted relative to their corresponding past year dividend yield, with the highest yield stocks receiving the highest weights.
- The VNX 25 Low Volatility index consists of the 25 stocks from the VNX Large 50 Index with the lowest realized volatility over the past 12 months. Constituents are weighted relative to the inverse of their corresponding volatility, with the least volatile stocks receiving the highest weights.
- Equal weighting gives the same weight, or importance, to each stock in an index. The smallest companies are given equal weight to the largest companies in an equal-weight index. This allows all of the companies to be considered on an even playing field.
- The VNX 25 Equal Weighted has the same constituents than its VNX 25 parent index. Instead of capitalisation weighting, each stock is weighted equally.
- The VNX 50 Equal Weighted has the same constituents than its VNX Large 50 parent index. Instead of capitalisation weighting, each stock is weighted equally.