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No investment channel both safe and attractive for now
The last months of year are always the time for the capital mobilization channels to activate. However, things are quite different this year. Experts still keep hesitant to give predictions about the most lucrative investment modes.
Dr Le Tham Duong, Dean of the Business Administration Faculty of the HCM City Banking University, said of the three most popular investment channels – real estate, gold and securities, he still cannot see any really good investment channel for now.
Investment activities quiet
Duong believes that the stock and real estate markets would not prosper in 2012, once the national economy is still in big difficulties. Therefore, investors still cannot earn money from the two markets, except the worldly wise ones.
Meanwhile, it is too risky to inject money in gold, since the domestic gold price has become overly high and even higher by 2-3 million dong per tael in comparison with the world’s price.
The world’s gold price proves to be unpredictable. It is also impossible to predict the domestic price, because the Vietnamese market is believed to be heavily influenced by speculation activities.
Meanwhile, Dr Dinh The Hien, Director of the Institute for Informatics Research and Applied Economics, thinks that the stock index may increase again towards the end of the year.
However, he said, though the national economy has gradually recovered, it is still not enough to attract foreign investment capital. Meanwhile, the capital supply from domestic sources remains limited, since a high proportion of capital has got stuck at unsold real estate projects, while banks still keep very cautious in disbursement.
Regarding the “commodities” on the stock market, bank shares, after a period of increasing sharply in prices, have become less attractive, while very few enterprises have promised high profit growth. As such, the stock market still lacks “valuable commodities,” which are the shares of the big enterprises.
Once the stock market cannot offer attractive “commodities” to lure big investors, it is impossible to create a new cash flow to the market. Therefore, analysts have every reason to believe that the VN Index would exceed the 500 point threshold.
It is very likely that the VN Index would hover around 450 points by the end of the year.
The weak demand and the capital shortage both are also the reasons behind the real estate freezing. Very few transactions have been carried out, which, according to Dr Nguyen Van Thuan from the HCM City Open University, is because investors feel insecure about the market, since they do not know about the actual values of properties.
Preserving capital – the top priority for now
Analysts all believe that in the current circumstances, when uncertainties still exist in the national economy, it would be better for investors to think of the measures to preserve their capital, rather than trying to seek the investment channels which promise high profits.
Dr Nguyen Van Thuan said keeping foreign currencies and making deposits at banks could be seen as the best choice for now to preserve one’s assets.
However, keeping dollars proves to be not the choice of the majority of people, since the State bank has vowed not to devaluate the local currency by more than three percent this year. The stabilized exchange rate means no profit for investors.
Depositing dong at banks proves to be a better choice, if investors just need to keep the capital intact while waiting for new investment opportunities. The current deposit interest rates in Vietnam are really more attractive than in other countries. Depositors can enjoy the interest rate of nine percent per annum for short term deposits and 11-12 percent per annum for longer term deposits.
vietnamnet
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