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How does the stock market change under Mr. Tran Van Dung?

Not long after the Central Inspection Committee announced the consideration of party discipline against the Party Committee of the State Securities Commission and individuals who are party members at units under and under the Commission, the Ministry of Finance Finance has made a disciplinary decision to dismiss the Chairman of the Securities Commission with Mr. Tran Van Dung, due to serious violations and shortcomings in his work.

How are you going to change after the end of the year? President of the Securities and Exchange Commission Tran Van Dung 1

Mr. Tran Van Dung has been appointed Chairman of the Securities Commission since July 2017 when he was the Chairman of the Board of Directors of the Ho Chi Minh Stock Exchange (HoSE).

Since then, Vietnam’s stock market has conquered a series of new peaks such as 1,200 points, 1,500 points. However, in these nearly 5 years, the market also experienced many fluctuations and incidents that made investors angry.

How are you going to change the balance between the two members of the Securities and Exchange Commission Tran Van Dung?

Mr. Tran Van Dung, former Chairman of the State Securities Commission, is an experienced person in Vietnam’s securities industry. Image: UBCK.

The period of outstanding growth

The past 5 years have been the strongest development period of Vietnam’s stock market since it came into operation in 2000.

From the market with more than 1,000 listed companies and concentrated trading, the market capitalization reached 70 billion USD with about 1.6 million domestic and foreign investors. After 5 years, the market capitalization at its best has reached 342 billion USD (March 2022), an increase of nearly 5 times, although the number of listed and concentrated enterprises only increased by 60%, with about 1,600 units.

Also during this time, the number of domestic and foreign stock investors increased to more than 5.2 million, 3.25 times higher than 5 years ago. This number is equivalent to more than 5% of the population of Vietnam, reaching 3 years earlier than the target set by the Government.

Judging from the price chart, in the period 2017-2022, despite many strong corrections, the general trend of Vietnam’s stock market is still up.

End of 2016Early 2022Present
Securities trading account number1.6 million won4.5 million won5.2 million won
Number of enterprises listed and registered for tradingMore than 1,000 yenMore than 1,640More than 1,610
VN-Index674 points1,527 points1,215 points
HNX-Index80 points500 points300 points
Market capitalization sizeThan 70 billion USDThan 342 billion USDThan $260 billion

Since Mr. Dung was appointed Chairman of the Securities Commission until now, the VN-Index has increased by more than 60%. Even if compared with the peak before the correction earlier this year, the market’s increase in these 5 years is more than 100%.

Not only VN-Index, HNX-Index in this period also recorded an increase of over 200% compared to the current price. If compared with the peak price at the beginning of this year, the increase from July 2017 to now of this index is up to nearly 5 times.

However, along with the record growth and expansion, from 2017 to now, the Vietnamese stock market has also experienced unprecedented fluctuations for various reasons.

If in the period 2012-2017, the stock market only recorded drops of about 15% from the latest peak, in 2017-2022, the market experienced sharp drops of more than 30%.

Three record reductions

At the beginning of 2018, the stock market was in a positive trend with the VN-Index increasing from 760 points (July 2017) to surpassing 1,200 points (April 2018), marking the second time that the stock market Viet surpassed the 1,200 point mark.

However, after peaking at 1,211 points, the VN-Index plummeted to 900 points after only 3 months.

Associated Bloomberg then made the comment “people who are investing in the Vietnamese stock market these days must have nerves of steel” showing that the market was in a negative state when it fell more than 27% from the peak.

Not only individual investors suffered losses, a series of large investment funds in the market also recorded a decrease in total assets during this period, such as Hestia down 19.4%; TVAM TVGF2 down 11.6%; VNM ETF fell 8.9%; Passion Investment down 8.6%…

Many reasons were then given to explain such as the stock market overheated 2 years ago, investors overestimated the market, the US raised interest rates 4 times in a row, or the US trade war – Central…

After the first drop, the market had a period of sideways movement in the 1,000-point area until early 2020, before recording the second sharp drop.

How are you going to change the balance between the two members of the Securities and Exchange Commission Tran Van Dung? 3

Movement of VN-Index since 2017 up to now. The source: Tradingview.

In early 2020, the Covid-19 epidemic began to break out in the world and Vietnam appeared the first cases. Not knowing the impact of the epidemic, the reaction of investors at that time was to sell off stocks at all costs.

At this stage, many investors are used to opening the electrical panel and seeing the market drop 40-50 points. From 1,000 points, VN-Index fell to 650 points in less than 3 months, equivalent to a net decrease of 35%.

After confirming the bottom at 650 points, the market has had 2 consecutive years of positive growth, bringing the VN-Index to surpass 1,500 points at the beginning of this year. Amid investors’ expectation that the stock would rise to the 1,600-point zone, the VN-Index turned back and dropped rapidly to the 1,160-point area in mid-May, equivalent to a net decrease of 24%.

Unlike the previous 2 strong drops, this 3rd drop is mainly explained by unfavorable information in the market.

Controversies about market management and supervision

In addition to the fluctuations of the market, securities under former President Tran Van Dung have also made investors angry many times about how to operate and monitor the market.

Specifically, many investors are still upset about the fact that Mr. Trinh Van Quyet twice illegally sold FLC shares with a value of trillions of billion, but only received a very light fine.

In which, in January 2017, Mr. Quyet sold 57 million FLC shares, earning more than 400 billion VND without reporting, not disclosing information according to regulations. However, Mr. Quyet was later only fined 65 million VND, while FLC’s stock plummeted, causing many investors to lose money.

On January 10 of this year, Mr. Quyet again illegally sold 74.8 million FLC shares, estimated to earn 3,700 billion VND. This time, the Securities and Exchange Commission and HoSE canceled the sale, however, the price of FLC’s stock still plummeted by nearly 60%, causing many investors to suffer heavy losses.

How are you going to change the balance between the two members of the Securities and Exchange Commission Tran Van Dung 4

Stock investors have been frustrated many times because of an order blocking incident on HoSE that took place in early 2021. Photo: Thach Thao.

Mr. Quyet was then only fined 1.5 billion VND and suspend trading for 5 months. It was not until the Investigative Police Agency – the Ministry of Public Security prosecuted and detained Mr. Quyet for manipulating the stock market that the Securities Commission’s administrative sanction decision was annulled.

Another event that angered investors was the fact that Korea’s KRX trading system had to leave the implementation schedule many times. This is also the direct cause of the order blocking incidents on the stock market in recent years.

According to the plan, the new system will come into operation from 2015 to help improve the order processing capacity of the Vietnamese securities trading system. However, this bidding package was later extended many times, up to now, after nearly 10 years, the system is still unable to operate.

Also from not being able to operate the new trading system, HoSE had to maintain the trading system provided by Thailand since the 2000s, causing the market to experience major problems many times.

In January 2018, HoSE had a serious problem when the orders entered in the closing session of ATC were not matched. The stock market then had to stop trading for 2 sessions to fix it.

By the beginning of 2021, HoSE’s trading system again appeared frozen, blocked orders, investors could not keep track of stock supply and demand, could not place buy and sell orders… This situation lasted for nearly half of the year. New Year is basically fixed.

However, by the session 10/1 of this year, investors reported experiencing a similar situation.

After a series of incidents in the market, and the fraudulent transactions of Mr. Trinh Van Quyet and Tan Hoang Minh were discovered, the Finance Minister decided to dismiss Mr. Tran Van Dung, ending nearly 5 years in office. Chairman of the Securities Commission of a leader with extensive experience in the Vietnamese securities industry.

Currently, the Ministry has assigned Deputy Minister Nguyen Duc Chi to be directly in charge of, directing and operating the Securities Commission since May 19.

(According to Zing)

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Mr. Le Hai Tra was forced to resign: Ho Chi Minh City Stock Exchange has a new leaderHo Chi Minh City Stock Exchange (HOSE) assigned Ms. Deputy General Director Tran Anh Dao to be in charge of running HOSE from May 20, replacing the newly disciplined General Director Le Hai Tra.
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