In a recent Investor Day event themed "Investing Amidst Many Variables," Le Anh Tuan, the CEO of Dragon Capital, discussed a rare phenomenon that has resurfaced after several years. Drawing parallels to similar occurrences in 2006 and 2012, Tuan noted that the stock market experienced significant rallies following those events. He emphasized the growing capital needs of Vietnam's economy, which is projected to require around $1.46 trillion for development investments over the next five years, with the private sector alone needing approximately $776 billion.

The current surge in interest rates, where six-month deposit rates have reached 9.5% and twelve-month rates hover around 9-9.2%, raises questions about the sustainability of these rates. Tuan explained that the rising interest rates are not merely a banking issue but reflect the substantial demand for capital within the economy. Despite inflation being above 4%, he suggested that the actual rate is closer to 3.4-3.5% when seasonal factors are adjusted, indicating that inflation is not yet a significant concern.

Tuan also pointed out that the exchange rate in the free market is currently lower than that in the interbank market, suggesting that the Central Bank has favorable conditions to increase foreign exchange reserves. He remarked that the government is effectively managing the foreign exchange market, which is not a common occurrence.

Looking ahead, Tuan believes that while interest rates are unlikely to rise significantly, a sharp decrease is also improbable due to the high demand for credit. He outlined two potential scenarios for interest rates: if they decrease gradually, Dragon Capital plans to increase investments in interest-sensitive stocks; however, if rates remain high, the strategy will shift to focusing on high-quality growth stocks that offer some level of cash flow protection.

Despite the current market conditions, Tuan considers the valuation levels to be attractive for investors. He advises that investors should selectively accumulate shares rather than broadly purchasing, especially avoiding speculative stocks. The current environment calls for a patient approach, focusing on long-term strategic companies with sustainable profits. The selective accumulation strategy, along with a dollar-cost averaging (DCA) method, remains a suitable choice for investors in the present context.