Introduction
Vietnam’s capital markets have undergone remarkable growth since their official establishment in 2000, becoming a key pillar of capital mobilization, economic expansion, and investment diversification. Over the past 25 years, the markets have evolved significantly, with nearly 1,600 companies trading stocks on HOSE, HNX, and UPCoM. As of July 2025, the total stock market capitalization reached VND8,316 trillion, equivalent to 72.2% of the estimated 2024 GDP, while the corporate bond market reached VND2,500 trillion, accounting for 22% of the estimated 2024 GDP.
Vietnam’s capital markets comprise a diverse investor base, including foreign and domestic participants, as well as institutional and retail investors. Retail investors dominate trading activity, engaging primarily in short-term, speculative transactions, which contributes to market volatility and limited liquidity depth. In contrast, institutional investors, both domestic and foreign, remain underrepresented, limiting market stability and long-term investment flows. Foreign investors have been net sellers since 2023, offloading a record VND102 trillion since the beginning of 2025 and surpassing the VND93 trillion net outflow recorded in 2024.
In the stock market, firms are currently valued at a P/E ratio of 15.4x, above the long-term average of ~13.3x, which indicates strong growth expectations but also signals limited room for further valuation expansion, which may constrain additional capital inflows. Nevertheless, this ratio remains well below the 2021 peak of ~19.5x, reflecting investor caution and weakened capital inflows, particularly from foreign investors amid the continued net selling trend.
In the bond market, issuance is highly concentrated in the banking and real estate sectors. As of February 2025, the banking sector accounts for 44% of total corporate bonds in circulation, followed by the real estate sector at 28.9%. This sectoral concentration underscores the dominance of banks in corporate financing and the heavy reliance of property developers on debt issuance, presenting potential systemic risks in periods of economic downturn or regulatory tightening.
Vietnam’s capital markets regulatory framework has evolved to support market expansion while addressing challenges related to transparency, investor protection, and financial integrity. The Securities Law, first enacted in 2006, laid the foundation for market regulation and investor participation, establishing a structured approach to securities issuance, trading, and compliance requirements. The 2019 reform of the Securities Law introduced stricter corporate governance rules, enhanced disclosure obligations, and a more robust enforcement framework. In response to recent market scandals, regulators in 2024 have further tightened compliance requirements and increased enforcement measures. These regulatory adjustments aim to strengthen investor confidence, promote market stability, and ensure sustainable long-term growth.
This Legal Guide provides a comprehensive overview of Vietnam’s capital markets, focusing on key regulations, compliance requirements, and emerging trends. It is structured into five main sections:
- Section 1: Overview of Vietnam’s Capital Markets – A broad introduction to financial instruments, key participants, market structure, and the regulatory framework.
- Sections 2 & 3: Stocks & Bonds – A summary of legal regulations governing securities issuance and trading.
- Section 4: Notable Requirements and Compliance Matters – A review of essential regulatory obligations, including securities issuance, trading, disclosure, and corporate governance requirements for public companies.
- Section 5: New Trends – Insights into SPACs, green bonds, cryptocurrencies, and financial centers in Vietnam.
