Inside information causes an unfair and unclear situation for investors. Photo: N.H

Control inside information

Speaking at the seminar "Solutions for sustainable stock market development" held in Ho Chi Minh City, the financial expert, Dr. Vu Dinh Anh said the biggest problem of the market and the transparency of the market fall in information, especially insider information, causing price gouging. All of that information has strengths but if it is not controlled, it will become a negative point, not only shaking the market but also greatly damaging the economy. Therefore, it is necessary to immediately improve the quality of stock market management, combat inside behavior and manipulation associated with technological development to suit the market growth scale. This is the responsibility of regulators, securities companies and investors. If this problem is handled, the market will develop well, becoming a capital mobilization for Vietnam's economic development.

Ms. Nguyen Hoai Thu, Member of the Board of Directors, CEO of the Public Securities and Bonds Investment Division at VinaCapital Fund Management Company, also said there should be more specific regulations on inside information and information sharing to ensure fairness for all investors.

“Overseas, insider trading will be criminally handled, while in Vietnam, there are no strict regulations, so the information is often shared to people with close and internal relationships before making it public, causing abnormal increase and decrease and when investors knew it, it was too late," said Ms. Nguyen Hoai Thu.

Ms. Thu also proposed that insiders are neither allowed to comment on the stock price of the enterprise they are managing, and nor say that the stock is cheap or expensive. Meanwhile, this is banned in foreign countries. In addition, it is necessary to separate consultation and analysis operations of securities companies from the proprietary trading sector, so that the proprietary trading sector does not affect the analysis agency and vice versa, because this is not fair and transparent for investors. This issue has also been clearly stated in foreign stock markets, while in Vietnam it has not been specified.

Improve the quality of products

Assessing the current situation of Vietnam's stock market, Mr. Nguyen The Minh, Head of Individual Customer Analysis Unit, Yuanta Securities Vietnam, said that the individual investments accounted for 90% of the transaction value in 2021 and in 2022, though there are sometime institutional investors that do not join transactions. Therefore, it is necessary to have solutions to mitigate this situation both in the short and medium term. Specifically, it is necessary to re-evaluate the quality of listed products.

Currently, the capitalization of Vietnam's stock market is about US$220 billion and there are 1,700 stocks on all three exchanges. The products are going for quantity rather than quality, which have greatly affected the upgrade. Therefore, it is necessary to improve the quality of products to upgrade the market and stay in the emerging market.

With the same point of view, Assoc. Prof. Dr. Nguyen Van Trinh, economic expert, Vice President of Vo Truong Toan University, emphasized that only the quality of products can attract investors. Along with that the State Securities Commission needs to control the increase of virtual capital.

Assoc. Dr. Nguyen Van Trinh also said that it is advisable to recalculate the proportion of "big players" in VN30 and VN-Index and reconsider the need for ATO and ATC sessions, because these sessions may cause disturbances in the market. .

Mr. Nguyen Hoang Hai, Vice Chairman of the Vietnam Association of Financial Investors (VAFI) assessed that the market still has some shortcomings and that solving these shortcomings depends on policy makers.

“We hope that policy makers should contact associations, investment funds, securities companies, experts to have solutions for the short and long term, then choosing the most feasible solution,” said Mr. Nguyen Hoang Hai.

Accordingly, VAFI is drafting short-term and long-term solutions for a healthy stock market. Specifically, in the short term, it is necessary to lower the margin trading level to avoid financial pressure on investors from mortgage release when the market goes down, easily causing a domino effect, damaging to investors and the whole market. At the same time, it is necessary to amend the current regulations related to the purchase of treasury shares of listed companies, because the prevailing regulations are quite complicated, contrary to international practices.