Recent analysis suggests that a group of Vietnamese stocks is set to benefit significantly from their upgrade to global indices. According to TPS Research, approximately $1.364 trillion in assets under management (AUM) by passive funds tracking FTSE indices related to emerging and global markets will be impacted by this change.

FTSE Russell recently announced the results of its semi-annual review for September 2026, identifying 27 Vietnamese stocks to be included in the FTSE All-Cap index. This upgrade is anticipated to facilitate a steady influx of capital from international index funds, particularly ETFs that mimic the FTSE Emerging Markets Index. Such investments are expected to flow into the Vietnamese stock market in a more organized manner, reducing the volatility typically associated with speculative capital.

Notably, the VN-Index is currently trading at a price-to-earnings (P/E) ratio of 11.9x, significantly lower than the 10-year average of 15.3x. Despite this, the medium- to long-term growth prospects for Vietnam's economy remain positive, with GDP growth for the first half of 2026 reaching 8.18% and expectations for it to rise to double digits in the future.

The combination of discounted valuations and the influx of organized capital creates an investment setup referred to by analysts as 'structural demand re-rating.' This is distinct from pure re-rating based solely on improved corporate profits. TPS Research estimates that once Vietnam's allocation reaches 100% after completing all four phases of the upgrade, approximately $1.54 billion in passive capital will flow into Vietnamese stocks, corresponding to Vietnam's projected weight in each index component.

As a result of the allocation mechanism of passive index funds being proportional to available market capitalization, TPS Research indicates that the bulk of this net buying capital will concentrate on leading stocks such as VIC, VHM, HPG, VPB, MSN, FPT, and VCB, which collectively represent over 60% of the projected capital influx. Investors are advised to closely monitor these stocks during the 'positioning window' leading up to September 21, 2026, as proactive capital often precedes the buying pressure from ETFs.

Additionally, the banking sector is expected to enjoy a 'double benefit' from the upgrade. Not only will banks directly benefit from capital flowing into the stocks within their portfolios, but they may also gain indirectly at the industry level as market liquidity improves. For securities companies, increased liquidity could enhance margin lending and brokerage activities, thereby supporting mid-term business results.

However, it is important to note that nearly 48% of the capital is concentrated in the real estate sector, primarily through VIC and VHM. This concentration means that the overall performance of the upgrade strategy will be unusually sensitive to price movements of these two stocks. Analysts recommend that institutional investors construct portfolios with a more balanced sector allocation compared to pure market capitalization weighting to mitigate concentration risk.