Open-ended funds will mark a milestone in Vietnam capital market as investors will have more tools while fund management firms can provide more products to meet market needs

Open-ended funds will mark a milestone in Vietnam capital market as investors will have more tools while fund management firms can provide more products to meet market needs,  Henk Ruitenberg, CEO of Prudential Fund Management Co. told local online newspaper Dau Tu Chung Khoan (Securities Investment).

Henk said open-ended fund operation will create premise for other kinds of fund such as pension fund which has not appeared in Vietnam but is popular in the world.

The key to the success of an open-ended fund is training, Henk Ruitenberg shared, pointing out that experiences from other Asian market showed that it will take 5-10 years for training task. Besides, it is necessary to prepare for infrastructure, software, management manpower and services as operating open-ended funds is more complicated than the close-ended ones.

The appearance of open-ended funds does not mean the end of close-ended fund, Henk said, highlighting that in the markets where Prudential is operating, they exist together.

Close-ended funds have advantage in low-liquid products such as private equity and real estate. Both private equity and real estate require a long-term approach but will certainly produce good yield in Vietnam, he said earlier.

However, he did not say whether or not Prudential will change into open-ended fund, reasoning that it will have to consider Vietnam’s legal framework and then seek for investors’ preferences. The decision will be made by the fund AGM as well as instruction and guidance by the State Securities Commission, he concluded.

Henk advises that Vietnam securities market still provides many good opportunities for long term investors.

Source Scarlet D./StoxPlus