VN-Index rises, but 49 of 55 active equity funds remain down this year

The VN-Index is climbing, but most active equity funds are not sharing in the rise. By the end of the Aug. 28 session, the benchmark stood at 1,832.12 points, up 2.7% from the end of last year. Yet the VN100 had fallen 1.4%, the VN30 was down 2.3%, and the VNMidcap had dropped 10.9%.

The gap was especially visible in August. The VN-Index added 96.34 points, or 5.55%, during the month. Real estate stocks supplied 48.7 points of that gain, while banks contributed 36.6 points. Together, the two sectors generated 88.5% of the index’s increase.

Individual large-cap shares also had an outsized effect. VIC alone contributed 32.1 points. VIC, VHM and VRE together added 43.6 points, equal to 45.3% of the VN-Index’s monthly rise. Because the index uses market-cap weighting, the performance of its largest constituents can heavily shape the headline result.

That concentration helps explain why portfolios can lag even when the benchmark rises. Funds with little or no exposure to the leading stocks benefit less, while heavier allocations to weaker sectors or market-cap segments can pull down returns. Among 55 active equity funds tracked at the end of August, 40 domestic and 15 foreign, only six had gained since the start of the year. All six were domestic funds.

Forty-nine funds, or 89.1%, remained below their year-opening levels. Twenty-seven had fallen at least 5%, and five had dropped more than 10%. The median return for the group was about negative 4.6%, roughly 7.3 percentage points below the VN-Index. EVESG led the group with a 2.6% gain, followed by TBLF at 1.9%, BMFF at 1.3%, VNDAF at 1.2% and MBVF at 1%. Relative performance changes with the benchmark: 52 funds outperformed VNMidcap, while only eight matched or beat VN100 and 10 matched or beat VN30.