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SGI Capital, in its April 2026 update report for The Ballad Fund, said Vietnam’s investment environment is entering a phase in which macro risks are rising both domestically and abroad. The fund highlighted several concerns, including higher inflation, the State Bank of Vietnam actively tightening lending and funding, and the risk of higher taxes imposed by the US government. It also pointed to the return of a large trade deficit, which could pressure foreign exchange reserves and exchange-rate stability.
In addition, SGI Capital noted that real estate market activity is slowing under interest-rate pressure, while a high supply of housing is further weighing on capital turnover in the economy—continuing to affect liquidity and bank lending rates. The fund said that while the government has taken timely measures to address liquidity shortfalls across the banking system, it may take several quarters to resolve imbalances and restore stable rates.
Against this backdrop, SGI Capital said equity markets will likely continue to face liquidity constraints and discounting pressure. However, the fund also identified signs of opportunity, saying the market is starting to open up investment chances in companies with positive earnings and valuations that capital had previously overlooked.
Still, SGI Capital cautioned that a truly large, low-risk opportunity will only emerge once risks are fully disclosed and reflected in overall market pricing.
As of the end of April 2026, The Ballad Fund (SGI Capital) maintained a high cash and cash-equivalent allocation of 70.5% of the portfolio, reflecting a cautious stance by managers. The fund said this cash overhang has been maintained since the end of August 2025.
In the first four months of 2026, The Ballad Fund recorded a return of 3.05%, while the VN-Index rose more than 10.7%, driven mainly by VinGroup stock.
Source: The Ballad Fund’s April 2026 update report.
SGI Capital described inflation and the trade deficit as major risk factors. It said the trade deficit trend could further pressure the exchange rate in the near term. The fund noted that the last time Vietnam recorded a trade deficit at roughly 10% of foreign-exchange reserves in the first four months of a year was in 2010–2011.
On inflation, SGI Capital said it has risen to 5.4% in March–April, exceeding the target approved by the National Assembly. It added that Vietnam is trying to spur investment and support higher growth amid rising global commodity prices. The fund attributed inflationary pressure to demand-pull effects as infrastructure investment expands and credit growth remains high, alongside additional cost pressures from rising oil prices and related products.
“Over the past 15 years, it has been rare for inflation to rise above the refinancing rate (the tool SBV uses to guide market rates) as it does today. These compounding forces will make inflationary pressures stronger and more persistent, with the potential to become a key policy and asset-market risk in the time ahead.” – The Fund’s assessment.
SGI Capital said many companies reported very positive Q1 2026 results, but overall market valuations remained skewed by VinGroup’s high valuation. It stated that the rest of the market is not attracting capital and is becoming cheaper despite improving corporate results.
The fund viewed this as a weakening of capital inflows, alongside a broadening of short-term speculative sentiment. It warned that investors who do not accept this risk trend may find it difficult to earn profits over the next six months.
SGI Capital also pointed to persistent foreign net outflows despite Vietnam’s market upgrade, noting that other emerging markets have not seen strong outflows recently.
The report said pressure from new equity issues remains elevated in Q1–Q2 2026 at levels similar to late 2025, contributing to liquidity shortages and making capital scarcer. SGI Capital expects primary issuance demand to continue this year as the stock market grows as an alternative financing channel to credit, which it said has exhausted its room to expand and is entering a restructuring phase under a new circular.
On margin debt, SGI Capital said absolute values continued to rise to record highs even as margin-loan rates were adjusted higher in line with overall lending rates in the economy.
The fund warned that margin risk could become truly significant when major shareholders and business owners who borrowed via brokerage deals face cash-flow difficulties in core operations, mainly related to real estate. It said borrowers could then be unable to service debt, potentially triggering a wave of forced selling. The fund identified margin lending rates and market liquidity in real estate as early indicators of this risk.
Note: Thừa Vân
Source: Vietstock. ABS Research said risk factors for stocks have declined significantly and that the market may be suitable for mid-term positioning.
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