Silver lining found in investment channel risk this year

Investors are pinning their hopes on different investment channels this year. (Photo: VNA)

Investors are pinning their hopes on different investment channels this year despite the many difficulties and risks brought about by COVID-19, analysts have said.

Vietnam’s rate of apartment floor space per person is among the lowest in Southeast Asia but it has a higher population density than Thailand and Malaysia. The property sector therefore has huge room for growth, according to analysts at Mirae Asset Vietnam.

The Viet Dragon Securities Corporation (VDSC), meanwhile, said that given the Government’s attention to the enhancement of public investment, especially in infrastructure, various transportation projects will be pushed ahead this year, creating momentum for the development of the real estate sector.

Low interest rates will also benefit homebuyers, prompting an increase in demand for housing.

The VDSC believes 2021-2022 will be a high point for the property sector, fostered by improved regulations, economic recovery, and dynamism from mergers and acquisitions (M&As).

Analysts also pointed out that the stock market remains an attractive investment channel this year.

Since the start of 2021, revised laws on securities, enterprises, and investment are taking effect, thus creating a uniform and transparent legal framework and investment climate for enterprises’ operations and at the same time protect investors and sustain the stock market.

Vietnam bringing COVID-19 under control and stabilising its macro-economy adds to the prospects for Vietnam’s securities market.

Investors, however, are advised to thoroughly consider any moves and remain vigilant regarding shares that have surged in the recent past.

Plunging savings interest rates in 2020 resulted in other investment channels thriving, particularly shares and bonds.

2020 also witnessed a surge in cryptocurrency investment, most notably Bitcoin, which leapt over 300 percent in value. Analysts say its value will not plummet as easily as it did in 2017 and may even go up again this year.

Mirae Asset Vietnam projected that low interest rates will be maintained during the year, making bank deposits less attractive than other channels.

Greenback investors have been warned of losses as reference exchange rates marginally declined amid redundant reserves. Finance-banking expert Nguyen Tri Hieu forecast that foreign currency will be the least attractive investment channel in 2021.

If the pandemic is successfully repelled, investors will favour risky assets, driving gold prices down. (Photo: VNA)

Fluctuations may not be seen in gold, thanks to confidence in the outlook of the national economy and the effectiveness of bringing COVID-19 under control.

The State Bank of Vietnam has devised response scenarios if necessary.

If the pandemic is successfully repelled, investors will favour risky assets, driving gold prices down. The other scenario may see gold prices rise./.