Vietnam: momentum is building

In early August, we published a detailed research note on Vietnam focused closed-end funds entitled “Time to Take Another Look”. Since then, the Vietnam Index has remained dull, falling by 7 per cent in local currency or 9 per cent in US dollars. However, share prices of the Vietnam closed-end funds have benefitted from the combination of corporate action and rising investor interest. VinaCapital Vietnam Opportunity Fund ($612m market cap) has risen 27 per cent in US dollars, whilst the real estate vehicle VinaLand ($456m market cap), is up 17 per cent. Following this strong run, we believe that the share prices may pause for breath in the short term, though we feel that they continue to offer value at discounts of 23 and 35 per cent, respectively.