After eight years on the watch list (since September 2018), Vietnam's stock market was formally reclassified by FTSE Russell from Frontier to Secondary Emerging status, effective 21 September 2026. The decision was first announced on 7 October 2025 and confirmed at the March 2026 interim review, when FTSE Russell found Vietnam met all the criteria.
A four-tranche schedule
According to FTSE Russell's September 2026 country classification announcement, inclusion began with a 10% weight from the open on 21 September 2026, followed by three further tranches in March 2027, June 2027 and September 2027. The effect of the upgrade will therefore play out over almost a year rather than in a single session.
How large could inflows be?
- FTSE Russell has estimated that passive funds tracking its emerging market index could bring inflows of up to about US$6 billion.
- Some advisers give more conservative estimates of US$1.5–4 billion in direct inflows, with an initial weight of around 0.22% in the FTSE Emerging index.
- The World Bank has estimated that upgrades by both FTSE Russell and MSCI could bring Vietnam up to US$25 billion in net foreign inflows by 2030.
Reforms that made it happen
Removing the 100% pre-funding requirement for foreign investors' trades was a key step highlighted by FTSE Russell, reducing counterparty risk and improving transparency. Regulators are also continuing to upgrade trading infrastructure, disclosure and account opening for foreign investors.
Macro fundamentals in support
Foreign capital follows earnings growth. GDP grew 9.01% in the first nine months of 2026 and 9.95% in Q3; registered FDI reached a record US$50.36 billion. Many listed companies beat profit targets early, such as Vinatex and Hoa Sen, or posted strong revenue growth, such as Vietjet. That gives international funds quality stocks to invest in.
How should investors think about it?
- Passive funds buy by index weight, so large-cap, liquid stocks with available foreign ownership room tend to attract attention first.
- Active funds favour well-governed companies with transparent disclosure, including in English, which gives listed firms an incentive to raise governance standards.
- Flows may not move in a straight line: exchange rates, global interest rates and profit-taking can make foreign buying and selling alternate in the short term.
vietnamii.com view: the FTSE upgrade recognises years of reform and opens a new cycle for the market. Combined with strong economic growth, this is a favourable period for Vietnam's stock market to grow in both size and quality. The next milestone to watch is a possible MSCI upgrade.