Vietnam's FTSE Russell Upgrade: Why Foreign Investors Kept Net Selling VHM, VIC and Banks

Overview

Foreign investors extended their net selling on HOSE through September 2026, the first month following Vietnam’s official FTSE Russell market upgrade, with outflows of more than VND 4.8tn (about USD 192m). Vinhomes (VHM) and Vingroup (VIC) absorbed the largest single-stock selling at VND 2.4tn and VND 1.2tn respectively, underscoring that index reclassification has not yet translated into sustained foreign demand for Vietnamese large caps.

Key Facts

• Foreign investors net sold more than VND 4.8tn on HOSE in September 2026, with no net-buying month recorded so far in 2026.
• Cumulative nine-month net selling on HOSE reached VND 97.8tn, approaching the VND 100tn mark.
• VHM led net selling at more than VND 2.4tn, followed by VIC at more than VND 1.2tn and VPB at more than VND 1.1tn.
• Banking and securities names also featured among top outflows: TCB, CTG, VCB, ACB, plus TCX and VIX.
• FPT topped net buying at more than VND 865bn, ahead of BSR (nearly VND 748bn), MCH (more than VND 726bn) and SBT (more than VND 723bn).
• On HNX, foreign investors net sold more than VND 110bn in September, led by IDC (about VND 73bn) and CEO (about VND 58bn), though HNX retains a year-to-date net-buy position of more than VND 702bn.
• On 18 September, HOSE trading value spiked to roughly VND 25.9tn as funds rebalanced, with foreign buying of nearly VND 10.5tn against selling of more than VND 9.2tn.

What Happened

Contrary to widespread expectations, foreign investors continued to sell down Vietnamese equities in the first week after FTSE Russell formally upgraded Vietnam’s market status on 21 September 2026. According to VietstockFinance data cited in the report, foreign investors net sold on seven of the eight final trading sessions of the month, reversing a brief period of positive net buying seen just before the upgrade. The VN-Index declined over the same window and liquidity failed to hold its elevated levels.

Võ Kim Phụng, Head of Analysis at Chứng khoán Beta, said the pattern was not surprising. Passive funds tracking the FTSE index are designed to deploy capital in stages to limit market impact and allow time for portfolio restructuring, meaning much of the first wave of upgrade-related money had already been reflected before 21 September through ETF and international investor rebalancing. He stressed that a market upgrade does not mean all international capital will be disbursed immediately, and drew a distinction between passive funds, which must buy according to index structure but in relatively small initial tranches, and active funds, which face no obligation to buy simply because Vietnam was reclassified.

Market Context

VHM closed at VND 69 on 5 October 2026, up 1.03% on volume of 3.72 million shares, while parent VIC closed at VND 230, up 2.86%. VPB traded at VND 23, down 0.87%, and TCB at VND 32, down 1.09%. All four are HOSE-listed. The September outflow data places VHM, VIC and VPB at the centre of foreign selling pressure even as their share prices showed mixed short-term direction, suggesting domestic flows have partially offset foreign supply in real estate while bank stocks remain more exposed to the rotation.

Strategic Significance

For long-term investors, the key takeaway is that Vietnam’s FTSE Russell upgrade is a structural, multi-year re-rating catalyst rather than an immediate liquidity event. Passive inflows will arrive in scheduled tranches tied to index inclusion timelines, while active managers will judge VHM, VIC and the banks on earnings, credit growth and property absorption rather than index status alone. The persistent nine-month outflow of VND 97.8tn also reflects global allocation preferences and currency considerations that a single upgrade does not resolve. The divergence between heavy selling in real estate and banking versus net buying in FPT, BSR, MCH and SBT indicates foreign money is rotating within Vietnam rather than exiting uniformly, favouring technology, energy and select consumer names over the index-heavy financial and property complex.

What to Watch

• FTSE Russell’s next index review and any confirmation of phased inclusion weights for Vietnamese equities.
• Monthly HOSE foreign flow data for October and November 2026 to see whether net selling decelerates after the September rebalancing.
• Third-quarter 2026 earnings releases from VHM, VIC and the banks, particularly credit growth and property presales.
• ETF creation and redemption activity on Vietnam-focused funds tracking the FTSE Global Equity Index Series.
• VN-Index liquidity and foreign-ownership room filings for large caps, which determine how much passive money can actually be absorbed.