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Open-end funds outperform amid stock market challenges in 2024
In contrast to the challenging market conditions faced by individual investors, open-end funds in 2024 have shown impressive investment results due to their long-term investment strategies, a report from Fmarket showed.
Since the beginning of 2024, the domestic stock market has been fluctuating within a narrow range, with the VN-Index consistently moving between 1165 and 1300 points.
Many market experts note that numerous investors are struggling to achieve their expected short-term profits. In less optimistic scenarios, experiencing losses is becoming a common occurrence.
Data from Fmarket reveals that there have been times when the VN-Index plummeted significantly to around 1200 points, with foreign investors consistently engaging in strong net selling activities since 2023.
As of the end of November, the total net selling amount had reached approximately VNĐ85 trillion (US$3.3 billion), with November alone witnessing net sales of around VNĐ12 trillion.
From early October to now, no trading session has surpassed the VNĐ20 trillion level, with capital trickling into the market in a scattered manner, leaving retail investors hesitant.
Consequently, the market has become highly divergent, with any increases not exhibiting contagious effects, only appearing in select individual stocks.
This makes stock selection more challenging than before, as leadership groups that drive long-term trends are rare.
According to a representative from SGI Capital, opportunities still exist but in limited scales and quantities, amid the prolonged difficulty in making profits from the stock market over the past six months.
Fmarket's data also showcased the outstanding performance of various funds compared to the general market, with names like SSI Sustainable Competitive Advantage Open-Ended Fund (SSISCA), VCBF Blue Chip Fund (VCBF-BC) and Bảo Việt Prospect Equity Open-Ended Fund (BVPF), all achieving impressive growth rates exceeding 20 per cent, far surpassing the 10.67 per cent growth of the VN-Index in the first 11 months of the year.
"In contrast to the challenging market conditions faced by retail investors, open-end funds have achieved impressive investment results this year due to their long-term investment strategies and the right selection of growth stocks according to economic cycles," Fmarket says in the report.
In the domestic stock market, particularly amid the high degree of consolidation in 2024, retail investors find it difficult to select the right stocks to catch the bottom during market declines.
In reality, even when the market rebounds, stocks bought at the bottom may not necessarily perform well and may even plummet if the chosen companies lack strong fundamentals.
According to historical statistics from Fmarket, looking back at 2022 when the market hit a low of 900 points, open-end funds have seen growth of over 100 per cent in the past two years.
During this period, the VN-Index only grew by around 33 per cent. For example, the SSISCA fund has seen a growth of 104.33 per cent over two years.
Many experts suggest that the current market simultaneously presents positive elements and hidden risks. In this context, open-end funds have emerged as a potential investment channel for non-professional investors, thanks to their ability to maintain stable performance amidst complex market fluctuations.
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