According to experts, people living abroad with 2 billion VND idle to invest for 2 years or more can choose real estate and stocks.
I am currently living abroad, have settled down for a long time and have no intention of returning home in the near future. I have 2 billion VND idle and want to invest in Vietnam. Currently, I see that interest rates are too low, so I am considering buying land, apartments or investing in stocks. I see many parties analyzing that both of these channels are currently at a low price point, suitable for long-term investment. I hope experts will give more opinions.
Phung Tran
Transaction at a bank in Ho Chi Minh City, November 2022. Photo: Thanh Tung
Consultant:
Assuming you have a financial plan and have 2 billion VND in spare money to invest for at least 2 years, you can choose the stock or real estate channel.
In 2024, the stock market has many optimistic signals, coming from Vietnam's and the world's macroeconomic policies. Based on data on employment, unemployment rates, and inflation, the US Federal Reserve (Fed) has shown a reversal in monetary policy with the possibility of cutting interest rates. At that time, the flow of foreign currency out of Vietnam will cool down, causing the State Bank to reduce pressure on exchange rates, thereby creating room to implement a loose monetary policy, increasing money supply to the market. In addition, cheap interest rates are a great support, creating attraction for the stock market.
2024 will have many challenges, but there will also be many opportunities for investors. Securities are a barometer, always ahead of the market when the economy recovers. In the current market context, the inflation rate is also relatively well controlled, at the same time, the market valuation P/B (stock price to book value) is about 1.6 - below the average of 2.1 of the Vietnamese market - relatively cheap with most large-cap stocks being priced at a low level. Therefore, the possibility of a deep decline in the VN-Index is unlikely, creating room for strong growth in the medium and long term.
Depending on your knowledge and experience in this investment field, you can choose to invest in individual stocks, seek professional advice or invest in fund certificates. Fund certificates are managed by qualified and experienced experts from fund management companies and are suitable for young investors with little experience in the market.
The current application process is not too complicated, you can open an account and authorize investment while abroad. With this form, you can focus on your expertise to generate good income, while still being able to achieve asset growth in Vietnam.
With the real estate channel, you should keep a lower proportion of the capital of 2 billion VND. In case your monthly surplus is stable, you can consider using financial leverage. When investing in an apartment at an early stage, the initial capital requirement is not high, you will gradually supplement from the income transferred from abroad to pay according to the prescribed progress. You need to choose a reputable project investor so that the apartment can be completed on time.
The real estate segment suitable for long-term small capital investment is agricultural land with a part of residential area or residential land in rural areas, in provinces adjacent to big cities. The profit potential from real estate investment depends largely on location, land planning, neighboring infrastructure system, utilities, surrounding population...
It is quite important that real estate investment is related to the legality of land use rights and housing on land. When you are abroad, you need to consider the possibility of returning to Vietnam to carry out legal procedures related to the purchase and sale. Authorization to buy and sell real estate is relatively complicated and potentially risky if not done properly. Transactions need to be carried out at reputable trading floors to receive professional and legal support to ensure the purchase and investment process is smooth and convenient.
The real estate market has the characteristic of recovering after the stock market. Therefore, in the current period, you should allocate a large proportion of your investment capital to stocks or fund certificates, waiting for the right time to invest in real estate. It should also be noted that both of these channels require medium and long-term investment time. Having a financial plan will help you limit the need to liquidate your investment before the deadline, causing the investment efficiency to decrease compared to the expected.
Tran Thi Mai Han
Personal Financial Planning Expert
FIDT Investment Consulting and Asset Management Company
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