IFRC/BeQ Holdings Logistics Indexes Series

CCPI > Case Studies > IFRC/BeQ Holdings Logistics Indexes Series
Vietnam’s economy is heavily reliant on a robust logistics sector, making logistics-related indices and ETFs valuable tools for understanding and potentially profiting from its growth.

Vietnam’s economy hums with the rhythm of its bustling logistics sector, a vital cog contributing roughly 4.5% of its GDP. But this is just the beginning of a thrilling journey. Buckle up, because the logistics engine is revving, primed for a 15-20% annual growth spurt in the years to come. What fuels this rapid expansion? First,

Vietnamese consumers are on a shopping spree, demanding ever-faster deliveries for their growing needs. Second, the region’s trade boom is putting Vietnam’s strategic location at the heart of the action, creating an insatiable demand for efficient logistics solutions. And to keep the wheels spinning smoothly, the government is pouring investments into infrastructure, building ports, highways, and logistics hubs that will further unlock the sector’s potential. This dynamic landscape paints a picture of a golden opportunity waiting to be unboxed.

Vietnam’s logistics sector is not just an economic powerhouse; it’s a gateway to a future where efficient movement fuels growth and prosperity. So, whether you’re an investor, an entrepreneur, or simply someone who appreciates the smooth flow of goods, keep your eyes on Vietnam’s logistics scene – it’s a story waiting to be written, and it’s just getting started.

While Vietnam currently lacks dedicated Logistics Equity Indexes, similar indexes are already available in other ASEAN markets.
  • Indonesia: IDX Transportation & Logistics Index (IDXTRANS)
  • Malaysia: FBM KLCI Transportation Index
  • Thailand: SET Transportation Index
  • Singapore: FTSE Straits Times Logistics Index

For the ASEAN region, several ETFs are launched, such as the iShares FTSE ASEAN Logistics & Transportation UCITS ETF (ticker: ILOG). It is a compelling option for investors seeking exposure to the booming logistics and transportation sector across the ASEAN region, including Singapore. ILOG was launched on June 11, 2018, and AUM of approximately USD 213.8 million as of October 27, 2023

 

IFRC/BeQ Holdings have designed a comprehensive Vietnam Logistics Indexes Series, catering to investors, analysts, and policymakers. The series provides tailored insights for various purposes, such as tracking sector performance, identifying growth opportunities, and benchmarking company performance:
  • Type: Benchmark (All Shares), and Tradable (Top 10)
  • Weghting: Capitalisation Weighted, Equal Weighted, Capped Weighted
  • Version: Price (PR), and Total Return (TR)
  • Currencies: VND, USD, EUR, …. , and USDT
  • Stardate : 31-12-2008
  • Base value: 1,000

For the Vietnamese Economy

Tracking Growth and Performance

Logistics indices provide a benchmark for measuring the overall health and performance of the logistics sector. This information helps policymakers assess the sector’s contribution to GDP, employment, and trade, allowing them to make informed decisions about infrastructure development, regulations, and incentives.

Attracting Investment

Strong logistics performance can attract foreign direct investment (FDI) into the sector, leading to job creation, technology transfer, and overall economic growth. Logistics ETFs, by offering diversified exposure to the sector, can further entice investors, providing much-needed capital for infrastructure development and expansion.

Enhancing Efficiency and Transparency

Tracking logistics indices encourages companies to improve their efficiency and transparency, as their performance becomes more visible to investors and stakeholders. This can lead to better logistics services, reduced costs for businesses, and ultimately, a more competitive economy.

For Investors

Portfolio Diversification

Logistics ETFs offer investors exposure to a diversified basket of logistics companies, reducing risk compared to investing in individual stocks. This diversification is particularly beneficial in Vietnam’s emerging market, where individual stock risks can be higher.

Growth Potential

Vietnam’s logistics sector is expected to grow rapidly in the coming years, driven by factors like rising domestic consumption, increasing regional trade, and government investments in infrastructure. Logistics ETFs can provide investors with a convenient way to capture this growth potential.

Hedging against Economic Downturns

Logistics sectors tend to be less volatile than other sectors during economic downturns, as demand for essential goods and services remains relatively stable. Logistics ETFs can therefore act as a hedge against economic uncertainty.

Overall, stock market logistics indices and logistics ETFs can play a valuable role in both Vietnam’s economic development and in providing investors with exposure to a promising sector. However, careful research and due diligence are essential before investing in any ETF, considering the limitations of the Vietnamese market and the inherent risks of any financial instrument.