Dragon Capital Vietfund Management (DCVFM) | Fund Factsheet

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VFMVFB – 05/2016


May 2016 was a quiet month for VFMVFB, no transactions were made during the month except for the deposit transactions in banks which have been approved by the Board of Representatives. However, in May 2016, VFMVFB achieves the highest growth of NAV/fund unit in the first 5 months in 2016 with an increase of 1.05%. The reason for this growth is downward of 5-year bond yield, the bond that VFMVFB is holding. The 5-year bond yields fell 19.8 basis points at the end of May compared to the beginning of the month brought capital gain to bond investment of the fund, the 5-year bond accounts for the largest weight in the fund’s portfolio. In May, VFMVFB’s efforts in investing in corporate bonds did not result as expected, this makes weight of cash in the fund’s portfolio higher than necessary. At 05/31/2016, the VFMVFB asset allocation is similar to the end of April, the weights of investments in government bond and certificates of deposit in its net asset value change slightly.

Fund net asset value (NAV) at 31/05/2016 reaches 13,011.93 VND/fund unit, increase 134.85 VND/fund unit (equivalent to 1.05%) compared to the corresponding figure in 30/4/2016 and increased 3.13% compared to the value at the time of 12/31/2015. The growth in May 2016 of VFMVFB NAV/fund unit is lower than the growth of the Total Return Composite Index released by Hanoi Stock Exchange (HNX-Index TRC). This trend will continue dues to increasing of weights of long-term bonds (over 5 years) in the list of bonds to be used to calculate the above index.

VFMVFB is only allowed to invest in corporate bonds which are listed or having listing plan within 12 months from the time of investment. This investment restriction significantly limits the ability of VFMVFB investing in corporate bonds. The trend of corporate bond issuance in the second half of 2016 is positive and will be an opportunity for VFMVFB.