Vietnam''s Stock Market Upgrade Countdown: March Review Will Steer Billions in Capital Flows

On February 5, 2026, the Vietnam Stock Exchange (VNX) held a working session with FTSE Russell to discuss the latest progress on the upgrade roadmap.
In less than two months, FTSE Russell will release its March interim review, determining whether Vietnam's stock market can proceed with its scheduled September reclassification from "frontier market" to "emerging market."
The outcome will directly influence billions of dollars in international capital flows.

Seven years in the making

The story begins in 2018.
That September, FTSE Russell placed Vietnam on its "upgrade watch list," signaling that Vietnam's stock market had potential to move up from frontier status — but the conditions were not yet met.

For seven years after that, every semi-annual review prompted the same question: did it pass this time?
The answer was always no.

The problem was structural.
Foreign investors buying Vietnamese stocks had to deposit 100% of the transaction value upfront — every last dong. This is called "full pre-funding."
Virtually no other major market has this rule. For large institutional investors, it is deeply inconvenient. Capital gets locked up with no flexibility.

FTSE Russell flagged this as the key upgrade hurdle.
Vietnam spent years working on a solution and in 2024 officially launched a "non-pre-funding" mechanism, requiring foreign investors to have funds ready only by settlement date (T+2).
Since going live, a growing number of foreign institutions have adopted the new system, with no settlement failures on record.

Around the same time, Vietnam partnered with the Korea Exchange to deploy the KRX trading system, which brought significant improvements in matching speed and stability over the old platform.

On October 7, 2025, FTSE Russell finally announced: Vietnam passed the review and would be reclassified from frontier to Secondary Emerging Market, effective September 21, 2026.

The money will come on its own

The most immediate effect of the upgrade is capital.
Massive volumes of ETFs and passive funds worldwide track FTSE-compiled indices.
Once Vietnam is included in the emerging market index, these funds must buy Vietnamese stocks according to their index weight — no choice involved.

FTSE Russell estimates about USD 6 billion in passive capital will flow in.
The World Bank's forecast is bolder: roughly USD 5 billion in the short term, potentially accumulating to USD 25 billion by 2030.

Vietnam's market already has a solid foundation.
At the end of 2025, the VN-Index closed at 1,784, up about 40% for the year.
Total market capitalization was around USD 387 billion, exceeding 80% of GDP.
Investment accounts surpassed 11 million, adding nearly a quarter in one year.
But compared to peer emerging markets, foreign participation remains relatively low. The upgrade could help narrow that gap.

28 stocks in line for inclusion

FTSE Russell has released a preliminary list of 28 Vietnamese stocks expected to be added to global indices.

Large caps (4): Hoa Phat Group (HPG), Vietcombank (VCB), Vingroup (VIC), and Vinhomes (VHM).
Mid caps (3): Masan Group (MSN), Sabeco (SAB), and Vinamilk (VNM).
The remaining 21 are small caps, including Vietjet Air (VJC), SSI Securities, and Sacombank (STB).

After the upgrade, Vietnam's weight in the FTSE Emerging Markets Index will be about 0.22%, and about 0.04% in the global index.
Those numbers look small, but for a country just graduating from frontier status, getting in the door is what matters.
Vietnam will sit alongside China, India, Indonesia, and the Philippines in the same classification.

The last hurdle: global broker access

One condition is not yet fully in place.
Currently, foreign investors must trade Vietnamese stocks through local Vietnamese brokers — international brokers cannot place orders directly.
FTSE Russell has said this is not a hard requirement for the upgrade, but it affects institutional investors' willingness to participate. It is flagged as a key observation item for the March review.

If the March results are unsatisfactory, the upgrade timeline could be delayed.
Most analysts, however, see a delay as unlikely. Vietnam has already made progress on this front.

Beyond FTSE, the other major index provider MSCI still classifies Vietnam as a frontier market.
The market consensus is that MSCI's emerging market upgrade is at least 2027 or later. That will be an even bigger milestone.