Ngoc, one of the first stock investors in Hanoi and a big gainer in 2006, said confidently: “Securities investment is quite simple. You do not have to have much money, with some VND10 million or more, you can play stock and become a big winner. So, why don’t you invest in stock?” Thanh, a staff of a Hanoi-based research institute, is groaning “In my office, we talk about stock investments more than about our work. Their feelings move up or down in tune with the price of their stocks. They even ask for information from their relatives who work for auditing companies and audit financial reports of listed companies. As for work, they only touch it when our boss gets angry.”
Le Thi Thu Hoa, the owner of a foreign exchange agent registered under the name of the Vietnam Bank for Agriculture and Rural Development, all our regular clients are very concerned about stock. Many even carry their feelings of win or loss to our office. When the price of a stock goes up, they wish it is to be down to buy more. To avoid loss, they normally sell immediately when there is a gain.
Tran Thi Thanh Huyen, who works for an electronic industrial company, said many people with only a small sum of money are also magnetised by stock fever. “The winner is normally boastful, therefore, more and more will flock in,” Huyen said. “However, they never speak up in case of loss. As a matter of fact, it seems no one is a loser.”
Within a half of a year, the VN-Index increased 2.5 folds and seems to go higher. The stock fever has wormed into every corner of urban cities, from the “roadside” stock investor to “white-collar” stock trader. Some silently explore upcoming listed stocks while others noisily discuss with newcomers about the latest notions of the financial market. But their common feature is small investors, which are now controlled by “herd psychology” investment.
In a market with a large majority of small investors with unstable psychology, the sudden rise and fall of the market is inevitable. For inexperienced investors, these investment decisions are absolutely ridiculous. When the price goes up, they buy in on hope of a higher and higher price. When the price goes down, they immediately sell out on fear of steep fall. Most of them don’t care about the listed companies or business situations of the listed companies. They buy in and sell out like gambling.
All long-term calculations are ignored by this group of unprofessional investors. At present, when the market goes up, all investors are happy but when it reverses, many will be in red, an experienced foreign investor said.
“As a senior worker of the financial sector, I dare not play stock. “Play” means unforeseen win or loss. However, many unprofessional investors flock to “play stock” - a job that easily leads to suicide by jumping off a high-rise building - as a super-profit generating field,” Deputy Director of Southeast Asia Commercial Joint Stock Bank (SeABank) Phan Thanh Tuyen said frankly.
Many experts have issued continuous warnings about the risky investment in stock because even senior investors cannot forecast the exact rise or fall in the price of a stock in the future.
SeABank’s Phan Thanh Tuyen said stock fever doest not affect careful investors because they will pour money into a young market full of risks. Their transactions are only “start-up practices”. The stock market has made appearance some 300 years ago, but in Vietnam the history is only six years. Therefore, the volatility is clear. The Vietnamese stock market is in the initial phase of rising and falling. Therefore, many senior investors are in a state of palpitation. The situation is even worse for green investors.
According to Tuyen, at present, investors should spend on newly listed stocks and ignore it when prices are pushed up. Because when the price of a stock is too high and the convertibility is not very attractive, it will be very hard to sell out the stock. However, unprofessional investors ignore warnings against the unexpectedly growing market and market volatility.
Hiep Hue
Vietnamese
