This marks a significant milestone in Vietnam’s financial market development, coming seven years after Vietnam was first added to FTSE Russell’s watch list for potential reclassification in September 2018.

FTSE Russell’s decision was based on Vietnam’s continued progress and recent reforms aimed at aligning with international market standards.

Since November 2024, Vietnam has implemented the Non Pre-Funding Solution (NPS), which allows institutional foreign investors to buy stocks without the need to pre-fund transactions.

A new trade settlement error-handling mechanism has been established, enhancing the market’s reliability and operational efficiency.

In addition, Vietnam has developed infrastructure allowing institutional investors to trade directly with global brokerage firms, thereby reducing counterparty risk and bringing the market closer to international norms.

FTSE Russell noted that Vietnam has now met all the criteria required for a secondary emerging market classification and acknowledged the efforts made by local regulators in modernising the market structure.

The upgrade opens the door for substantial foreign capital inflows, particularly from exchange traded funds (ETFs) that track FTSE Russell indices. Vietnam is expected to attract billions of US dollars in potential foreign investment, significantly enhancing the country’s integration with global capital flows.

According to international securities firms, net foreign inflows into Vietnam’s stock market could reach US$6–8 billion, and in a more optimistic scenario, may even exceed US$10 billion.

The effective date for Vietnam’s market upgrade is expected to be Monday, September 21, 2026, following an interim review scheduled for March 2026.

This review will assess whether Vietnam makes sufficient progress in expanding trading access via global brokerage firms - a key factor in facilitating index replication and meeting the operational requirements of the international investment community.

Vietnam ready for potential stock market upgrade on October 8

VOV.VN - This week, both domestic and international investors are closely watching October 8, when FTSE Russell is set to release its periodic market classification review, including the potential upgrade of Vietnam’s stock market from frontier to emerging status.