This article will help you answer all your questions about What is VN-Index?? The meaning of VN30-Index for investors is right below this article.
What is VN Index?
VN-Index is a market index that shows the price fluctuations of stocks listed on the Ho Chi Minh City Stock Exchange (HOSE). In other words, VN-Index is like a “scale” measuring the overall health of the Vietnamese stock market. When VN-Index increases, it shows that the stock prices of many listed companies are increasing, and vice versa.
Some important points about VN Index:
- Purpose: VN Index helps assess the fluctuations of the Vietnamese stock market and provides information on the general trend of the market.
- How it is calculated: The VN Index is calculated by adding up the total market value of the companies participating in the index, then dividing it by an adjustment factor to create an easy-to-follow number.
- Companies considered: VN Index usually focuses on large-cap and reputable companies, representing the influence of these companies on the stock market.
- Market Open and Close: The VN Index is usually updated during market opening hours, and the end-of-day results are often used to gauge intraday market performance.
- Monday Market: The VN Index usually opens on Monday to reflect stock price movements after the weekend.
The VN Index is an important tool that helps investors, businesses and market watchers evaluate and shape the trend of the Vietnamese stock market.
What is VN Index and what does it mean?
>>> See more articles: THE IMPORTANCE OF THE STOCK MARKET TO THE ECONOMY – HVA Group
VN-Index is the main stock market index of Vietnam, used to measure the performance of the stock market as well as to reflect the general trend of the market. VN-Index points show the level of volatility of stock prices on the Vietnamese stock market compared to a fixed previous point in time.
What does VN Index mean? for the Vietnamese stock market.
The VN-Index (Vietnam's main stock market index) score is important in assessing and monitoring the overall performance of the Vietnamese stock market. Here are some key meanings of the VN-Index score:
- Measuring Market Performance: VN-Index is an important measure to assess the overall volatility of the Vietnamese stock market. The rise and fall of VN-Index often reflects the general situation of the stock market.
- Market Trend Forecasting: The movement of the VN-Index can be used to forecast future market trends. The rise and fall of this index often reflects investors' sentiment and predictions about the market.
- Accompanying Investors: VN-Index provides important information to help investors monitor and evaluate the performance of stocks and the general market, thereby supporting their investment decisions.
- Assessing the Impact of Events: The movements of the VN-Index often reflect the impact of economic, political and social events on the stock market.
- Boosting Credit Returns: When the VN-Index rises, the market often becomes more positive, boosting credit returns and increasing investment opportunities for investors.
Therefore, the VN-Index score is not just a number but also an important indicator to monitor and understand the Vietnamese stock market.
How to calculate VN-INDEX
Identify the basket of stocks
- Selection criteria: Not only based on liquidity and capitalization, but also considering the representativeness of different industries in the economy.
- Periodic Adjustments: The composition of the basket of stocks is reviewed and adjusted periodically to ensure it accurately reflects market conditions.
Calculate the market capitalization of each stock
- Formula: Market capitalization = Stock price x Number of outstanding shares
- For example: If a stock is priced at VND 50,000/share and there are 100,000,000 shares outstanding, then the market capitalization of that stock is VND 50,000 x 100,000,000 = VND 5,000 billion.
Calculate free-float adjusted capitalization
- Free-float: Is the portion of shares that can be freely traded on the market, excluding shares of major shareholders, treasury shares, etc.
- Why the adjustment: Because only free-float stocks can truly reflect market fluctuations.
- Formula: Free-float adjusted capitalization = Capitalization x Free-float share ratio
Calculate VN-Index
- Formula: VN-Index = (Total free-float adjusted capitalization of all stocks in the basket) / (Base factor) x (Adjustment factor)
- Base coefficient: Is the value of the index at an initial point in time, usually taken as 100 points.
- Adjustment Factor: Used to adjust the index when there are major changes in the stock basket or calculation method.
What is the concept of VN30 Index? The importance of VN30 Index
What is VN-Index 30?? In fact, it is another name for VN30-Index. Both refer to the same index. VN30 Index is an important stock index in Vietnam, built on the 30 stocks with the largest capitalization and highest liquidity, listed on the Ho Chi Minh City Stock Exchange (HOSE). In other words, VN30-Index is a "basket" containing 30 of the most delicious and most actively traded "fruits" on the Vietnamese stock market.
Reasons why VN30 Index becomes an important factor in Vietnam stock market:
- Representing the “big guys”: VN30-Index reflects the situation of the largest and most influential enterprises in the market, helping investors have an overview of the business situation of leading companies.
- Reference Index: VN30-Index is often used as a measure to compare the performance of investment funds, individual investment portfolios, and to evaluate the effectiveness of different investment strategies.
- Basis for derivative products: VN30-Index is the basis for developing derivative products such as futures contracts and options, helping investors manage risks and generate profits.
- Investor sentiment indicator: The movement of VN30-Index often reflects the general sentiment of investors towards the market. When VN30-Index increases, it shows that investors are optimistic about the market's prospects and vice versa.
What is VN Index and is it a stock exchange?
“VN Index” is not a trading floor. It is more like a measure, reflecting the increase or decrease in market value of companies listed on the Ho Chi Minh City Stock Exchange (HOSE).
The Ho Chi Minh City Stock Exchange (HOSE) is where stocks, bonds and other securities are traded. HOSE is where investors meet to make transactions.
VN-Index is calculated based on the capitalization value of companies listed on HOSE. When the stock prices of these companies increase, VN-Index also increases, and vice versa.
In short
VN-Index is an important measure reflecting the state of the Vietnamese stock market. With detailed information provided by the platform HVA about What is VN-Index?, What does VN-Index mean? as well as the How to calculate VN-Index will help investors grasp the general trend of the market and compare the performance of their portfolio with the general market, thereby evaluating the effectiveness of the chosen investment strategy.
