Bloomberg and KNTU Asset Management Launch Vietnam VN30 Futures Leverage ETF

[Asia Economy Reporter Minji Lee] Bloomberg announced on the 25th that Korea Investment Trust Management has adopted the Bloomberg VN30 Futures Index as the underlying index for the newly launched domestic market product, ‘KINDEX Bloomberg Vietnam VN30 Futures Leverage.’ This is the first Bloomberg index product launched in Korea.

‘KINDEX Bloomberg Vietnam VN30 Futures Leverage’ plans to track returns using the VN30 futures, Vietnam’s first tradable stock index futures launched in 2017. Through this product launch, domestic investors will have the opportunity to invest in the rapidly growing Vietnamese economy among many ASEAN countries.

This product allows broad access to Vietnam’s derivatives market regardless of foreign investor restrictions, and at the same time, its currency hedging structure reduces exposure to exchange rate fluctuation risks.

According to the Hanoi Stock Exchange, the average daily trading volume of Vietnam’s derivatives market in 2019 increased by 12.6% from the previous year to 88,740 contracts. From January to July 2020, the average daily trading volume recorded 173,000 contracts, a 95% increase compared to 2019, showing growth. The explosive growth of Vietnam’s derivatives market is driving foreign capital inflows, with products tracking the VN30 index being the main target.

Jung Sung-in, head of the ETF Strategy Team at Korea Investment Trust Management, said, “The launch of KINDEX Bloomberg Vietnam VN30 Futures Leverage, which benchmarks the Bloomberg VN30 Futures Index, signifies the beginning of a long-term partnership between Bloomberg, a global leader in index providers, and Korea Investment Trust Management. Bloomberg’s world-class data, analytics capabilities, and index tools will contribute to growing the domestic ETF market and providing necessary services to domestic investors with diverse investment needs.”

Ji Zhuang, Bloomberg Index APAC Head, stated, “Bloomberg supports some of the largest bond ETF products in the Asia-Pacific region and, based on proven performance, plans to modify and expand multi-asset index products tailored to investor needs in the rapidly growing Asia-Pacific market.”