20160501_BSC_Market Insights_VN_P-Notes

Excluding the value of put-through trading from VIC, foreign investors bought more than 1,200 billion in the first three weeks in 04 / 2016. In the context that the capital flow of foreign funds and ETF funds fairly remained calm after the Fed raised interest rates, recent capital inflows are said to be P-Notes, which are managed by foreign investment banks operating in Vietnam. Active buying of foreign investors focusing on larger BCs are putting positive impact on the Indices’ movement. VN-Index was up strongly, continuously reaching new highs and approaching the psychological mark of 600 points.

P-Notes (Participatory Notes) is a type of derivative financial instruments, which are issued for foreign investors by the investment organizations operating in emerging stock markets. Based on a portfolio of stocks (usually blue chips, good liquidity, market representative) holding, financial institutions operating in that market will issue P-Notes to foreigners who do not want to engage or do not have direct access to investments in that market.