- Extreme market volatility: VN-Index once dropped 6.67% in a single session (January 19, 2022)
- Highly differentiated liquidity: 70% of trading value concentrated in the top 50 large-cap stocks
- Governance risk: Cases like FLC, HVA have eroded investor confidence
- Unstable foreign capital flow: Foreign investors sold net more than $600 million in 2022, but bought net $1.2 billion in 2023
- Policy fluctuations: For example, tightening bond regulations indirectly affected real estate stocks
Pocket Option: Should You Invest in Stocks or Bonds in the Context of Vietnam's Economy in 2025
The question "should you invest in stocks or bonds" always creates much debate among Vietnamese investors. This article analyzes in detail the characteristics, advantages, and risks of these two popular investment instruments, providing capital allocation strategies suitable for your financial goals and risk tolerance levels.
Fundamental Differences Between Stocks and Bonds in the Vietnamese Market
The Vietnamese stock market has grown more than 15% in the past year, while the bond market has recovered after a crisis period — making the question of whether to invest in stocks or bonds more urgent than ever for Vietnamese investors. This is not just a simple question but a strategic equation that requires a deep understanding of the characteristics of each asset type.
Stocks represent ownership in a company, turning investors into shareholders with voting rights and dividend eligibility. In contrast, bonds are debt instruments – buyers directly lend money to the issuing organization and receive fixed interest rates during the holding period, minimizing price volatility risk.
| Characteristics | Stocks | Bonds | Real Examples in Vietnam |
|---|---|---|---|
| Nature | Equity securities | Debt securities | VNM (stock) vs TD1929004 (bond) |
| Benefits | Ownership rights, voting, dividends | Regular interest, principal repayment | FPT paid 20% dividends (2024) vs Masan bonds paid 9.3%/year |
| Duration | Indefinite | Fixed (usually 1-30 years) | VHM (perpetual) vs Vingroup Bonds (5 years) |
| Risk level | High | Low – Medium | FLC decreased 70% (2022) vs Government bonds fluctuated <2% |
| Profit potential | Unlimited | Fixed by interest rate | HPG increased 127% (2020-2021) vs VPBank Bonds 7.5%/year |
The Vietnamese market has specific characteristics that directly affect the question of which is riskier, bonds or stocks. The Vietnamese stock market – with the VN-Index only established in 2000 – is still quite young, highly volatile, and frequently influenced by investor psychology. Meanwhile, the bond market, especially corporate bonds, went through a major crisis during 2022-2023 with a series of defaults from major real estate groups like Tan Hoang Minh and Van Thinh Phat.
Risk and Return Analysis: Stocks vs Bonds
When considering whether to invest in bonds or stocks, Vietnamese investors need to understand the risk-return relationship in the current economic context. With GDP expected to increase by 6.5-7% in 2025, inflation controlled at 3.5-4%, but USD/VND exchange rate under pressure to increase by about 3-4% annually, investment assets will perform differently.
Stock Investment Risks in Vietnam
When analyzing which is riskier, stocks or bonds, data from the Vietnamese market during 2020-2025 shows stocks have significantly higher volatility. The VN-Index once lost more than 30% of its value in just Q1/2022 and fluctuates an average of 2-3% weekly. The main risks include:
The Pocket Option platform provides proprietary portfolio risk management tools, helping Vietnamese investors simulate portfolio volatility in different market scenarios (bull, bear, sideways) with up to 85% accuracy based on Machine Learning models.
Bond Investment Risks in Vietnam
The Vietnamese bond market experienced a “perfect storm” during 2022-2023 with many expensive lessons for investors:
- Severe liquidity risk: Many investors could not sell bonds on the secondary market when they needed cash
- High default risk with corporate bonds: Cases of Tan Hoang Minh, Van Thinh Phat, Novaland caused billions of dollars in damages
- Major interest rate fluctuations: 10-year government bond yields increased from 2.1% to 5.2% in just 18 months (2021-2022)
- Limitations in transparency: Many bonds were issued with incomplete information about collateral
- Changing legal framework: Decree 65/2022/ND-CP tightened regulations, causing the new issuance market to freeze for a period
| Risk Type | Impact on Stocks | Impact on Bonds | Actual Data (2020-2025) |
|---|---|---|---|
| Market Risk | High (strong volatility) | Low (less volatility) | VN-Index: ±3-4%/week vs Government Bonds: ±0.5%/week |
| Inflation Risk | Medium (can increase in price) | High (fixed income) | Inflation 2023: 3.6% > Deposit rate: 3.3% |
| Liquidity Risk | Medium (depends on stock) | High (weak secondary market) | Stock trading value: ~15,000 billion/day vs Bond trading value: ~2,000 billion/day |
| Default Risk | Low with blue-chips | High with corporate bonds | 16 businesses defaulted on bonds (2022-2023) totaling 118,000 billion VND |
Analysis of the Vietnamese Market Situation 2024-2025
To answer the question of whether to buy stocks or bonds in April 2025, we need to analyze specific market data:
The Vietnamese stock market currently has an average P/E of about 15.8x, lower than the regional average (17.2x), indicating valuations are still at reasonable levels. Market liquidity has improved with average trading value reaching 15,000-18,000 billion VND/session. However, the market remains highly differentiated with banking, retail, and information technology stocks leading growth.
- Deposit interest rates: Decreased to 3.8-4.7%/year for 12-month terms (lowest in 4 years)
- FED expected to cut interest rates: 2-3 times in 2025, creating conditions for the State Bank to ease monetary policy
- Corporate profit growth: Forecast to increase 15-18% in 2025 after increasing 10% in 2024
- Bond market recovery: New issuance volume up 35% compared to the same period last year
Pocket Option not only provides weekly market analysis reports but also offers proprietary stock-bond performance comparison tools, supporting Vietnamese investors in making data-driven decisions based on yield, risk, and correlation with macroeconomic indicators. Pocket Option’s “Smart Portfolio Builder” feature helps build optimal portfolios based on the Markowitz model with 10 years of trading history from the Vietnamese market.
| Economic Indicator | 2025 Forecast | Impact on Stocks | Impact on Bonds | Recommendation |
|---|---|---|---|---|
| GDP Growth | 6.5-7% | Very positive | Neutral | Increase weight in consumer and banking stocks |
| Inflation | 3.5-4% | Neutral | Negative | Limit long-term bonds (>10 years) |
| Base Interest Rate | Decrease 0.5-1% | Positive | Positive (short-term) | Opportunity to buy 3-5 year bonds |
| USD/VND Exchange Rate | Increase 3-4% | Cautious | Cautious | Allocate a portion to USD-linked government bonds |
Asset Allocation Strategy for Vietnamese Investors
The question of whether to invest in stocks or bonds should not be answered in a “one-size-fits-all” manner. Each Vietnamese investor needs to build an asset allocation strategy based on 4 core factors: age, financial goals, risk appetite, and investment timeframe.
Strategy by Age and Life Stage
Instead of applying the Western formula “100 – Age = % Stocks”, Vietnamese investors should adjust to the formula “110 – Age = % Stocks” due to the higher average retirement age in Vietnam and many limitations in bond market liquidity.
| Age Group | Stocks | Bonds | Cash | Specific Recommendations for Vietnamese Market |
|---|---|---|---|---|
| 20-30 years | 70-80% | 10-20% | 10% | 70% VN30, FPT, MWG, HPG; 20% 5-year government bonds; 10% cash |
| 30-40 years | 60-70% | 20-30% | 10% | 40% blue-chip stocks; 20% value stocks; 30% bonds; 10% cash |
| 40-50 years | 50-60% | 30-40% | 10% | 40% VCB, VHM, VNM; 10-20% growth stocks; 30-40% diverse bonds |
| 50-60 years | 40-50% | 40-50% | 10-20% | 35% high dividend stocks (POW, GAS, NT2); 45% bonds; 20% cash |
| Over 60 years | 20-30% | 50-60% | 20-30% | 25% high dividend stocks; 55% short-medium term bonds; 20% cash |
Pocket Option provides a proprietary “Retirement Planning Calculator” for the Vietnamese market, accurately calculating the optimal asset allocation ratio based on 15 personal parameters (age, income, career stage, financial obligations, retirement goals…) with accuracy up to 92% compared to standard international models.
Specific Recommendations for Vietnamese Investors
When faced with the choice of whether to invest in bonds or stocks, Vietnamese investors should apply asset allocation strategies based on specific financial goals:
Investment by Financial Goal
| Financial Goal | Timeframe | Recommended Strategy | Specific Examples in Vietnam |
|---|---|---|---|
| Emergency Fund | 0-6 months | 100% cash and cash equivalents | 3-month bank deposits (MB, Techcombank, VPBank) |
| Car purchase, studying abroad | 1-3 years | 70% short-term bonds, 30% dividend stocks | 2-year government bonds + POW, GAS, VNM stocks (4-7% dividends) |
| Home purchase | 3-7 years | 50% bonds, 40% stocks, 10% cash | 5-year government bonds + ETF E1VFVN30 + VHM, VIC, NLG stocks |
| Retirement | 10+ years | 60-70% stocks, 20-30% bonds, 10% cash | Diverse portfolio of VN30 stocks + long-term bonds |
When evaluating which is riskier, bonds or stocks, Vietnamese investors need to analyze each financial instrument in detail:
- Vietnamese Government Bonds: Extremely low risk (BB+ rating by S&P), yields 4.8-6.2%/year depending on term (higher than Thai, Malaysian government bonds)
- A+ Corporate Bonds: Low-medium risk, yields 7.5-9%/year (VinGroup, Masan, BIDV…)
- B Corporate Bonds: Medium-high risk, yields 9-12%/year (requires careful due diligence)
- VN30 Stocks: Medium risk, growth potential of 12-15%/year, high liquidity
- Mid-cap Stocks (VNMID): Medium-high risk, potential 15-25%/year, strong fluctuations
- Small-cap Stocks (VNSML): High risk, potential 20-40%/year, but low liquidity
Pocket Option provides an online trading platform with the lowest transaction fees in the market (from just 0.15% for stocks and free trading for government bonds), along with a proprietary corporate bond credit rating system developed in collaboration with leading credit experts.
Common Mistakes When Investing in Stocks and Bonds
When deciding whether to buy stocks or bonds, Vietnamese investors need to avoid the following serious mistakes:
- Chasing “hot stocks”: 70% of F0 investors lost money during 2021-2022 due to investing based on rumors
- Excessive concentration of capital: Investing >20% of portfolio in a single stock/bond
- Buying corporate bonds for high interest rates: Ignoring analysis of the company’s financial situation
- Cutting losses too early, taking profits too late: “Fear of loss” psychology makes portfolios less efficient
- Not updating market information: During major fluctuations such as COVID-19, geopolitical conflicts
| Mistake | Actual Consequences | How to Fix | Solutions from Pocket Option |
|---|---|---|---|
| Investing too much in bonds when young | Investors 25-35 years old missed opportunities for >150% returns during 2020-2023 | Increase stock proportion to 70-80% when under 35 | Age-Based Asset Allocation Tool |
| Investing too much in stocks before retirement | Many people preparing for retirement lost 25-30% of assets in 2022 | Gradually reduce stock weight starting 5 years before retirement | Retirement Countdown Planner |
| Buying corporate bonds just for high interest rates | 40,000+ investors lost money in the Tan Hoang Minh case (10.3%/year) | Carefully analyze financial reports, credit ratings | Proprietary credit rating system |
| Buying “hot” stocks based on rumors | FLC decreased from 24,000 to 3,500 VND (-85%) in just 6 months | Conduct fundamental and technical analysis before investing | Weekly in-depth analysis reports |
To avoid these mistakes, Pocket Option not only provides free investment training courses but also develops an AI-based automatic risk warning system, helping investors identify abnormal signs in stocks and bonds before the market reacts, by analyzing millions of historical data points.
Conclusion: Stocks or Bonds – Not “Either/Or” but “And”
The optimal answer to the question whether to invest in stocks or bonds lies not in choosing one or the other, but in building a portfolio combining both assets in proportions suitable for each investor. The “dynamic asset allocation” strategy has proven to outperform “stocks only” or “bonds only” strategies during 2015-2025.
For the Vietnamese market, a smart investment strategy should include:
- Multi-dimensional diversification: Not just between stocks and bonds, but also between industry groups, market capitalization, and bond terms
- Strategic allocation using the “bucket approach”: Dividing assets into 3 groups (short-term – cash, medium-term – bonds, long-term – stocks)
- Periodic rebalancing: Adjusting the portfolio 3-4 times/year, especially after major market fluctuations
- Investing according to macro trends: Leveraging Vietnam’s mega-trends (urbanization, middle class, digital transformation…)
- Using modern technology: Applying big data analysis tools and AI from platforms like Pocket Option to optimize investment decisions
Vietnam’s financial market is in a phase of strong transformation, with many important reforms such as market upgrades, improving the bond legal framework, and developing derivative instruments. These changes create both challenges and opportunities for investors.
Finally, whether you choose stocks, bonds, or a combination of both, the determining factor for success is not “timing the market” but “time in the market.” Research from Pocket Option shows that Vietnamese investors who persisted with reasonable allocation strategies for 5 consecutive years achieved 65% higher performance compared to investors who frequently adjusted weights according to market sentiment.
FAQ
Can stocks and bonds be invested simultaneously?
Not only can you invest in both stocks and bonds simultaneously, but you should. This strategy, called "optimal asset allocation," has been proven to reduce risk by up to 32% while maintaining 85-90% of the returns compared to an all-stock portfolio. In Vietnam, professional investors typically allocate 60-70% to stocks and 30-40% to bonds during normal market periods. This ratio will change according to age (decreasing stocks as age increases), financial goals, and personal risk appetite.
What is the current interest rate for Vietnamese government bonds?
Vietnamese government bond interest rates in April 2025 range from 4.2% to 6.2% depending on the term, specifically: 1-year bonds: 4.2-4.3%; 3-year bonds: 4.5-4.7%; 5-year bonds: 4.8-5.0%; 10-year bonds: 5.2-5.5%; and 15-year bonds: 5.8-6.2%. Compared to Q1/2024, interest rates have decreased by approximately 0.3-0.5 percentage points due to the State Bank's continued monetary policy supporting growth. Investors can refer to updated interest rates on the HNX website or through trading platforms like Pocket Option with real-time information.
How to assess corporate bond risks in Vietnam?
Assessing Vietnamese corporate bond risks requires analyzing 5 key factors: 1. The financial situation of the issuing organization (especially DSCR > 1.5x, debt-to-equity ratio < 2.0x) 2. Purpose of capital use (bonds investing in clearly profitable projects are safer than debt restructuring bonds) 3. Collateral assets (value, liquidity, and legality) 4. Repayment history (check previous loan records) 5. Terms and conditions of issuance (financial commitments, bondholder rights) Refer to credit ratings from reputable organizations or use Pocket Option's risk assessment tool with 27 in-depth analysis criteria specifically designed for the Vietnamese market.
Should I invest in stock ETFs or government bonds?
The decision between stock ETFs (such as VN30 ETF, VNFIN LEAD ETF) and government bonds depends on 3 main factors: investment timeframe, profit objectives, and risk tolerance. With a timeframe >5 years, Vietnamese stock ETFs have an average historical return of 12-15%/year (2015-2025), significantly higher than government bonds (5-6%/year). However, stock ETFs also have greater volatility (standard deviation of 22-25% compared to 3-5%). For short-term goals (1-3 years) or investors who need capital preservation (such as those nearing retirement), government bonds are a safer choice. The optimal strategy is usually to combine both in a ratio appropriate to your personal situation.
How to buy government bonds in Vietnam?
To buy Vietnamese government bonds, you have 3 main methods: 1. Through securities companies: Open an account at a securities company (like Pocket Option) then place orders to buy bonds on the secondary market at HNX. Minimum transaction value: 100 bonds (100 million VND). Advantage: easy access, ability to buy/sell flexibly. 2. Through commercial banks: Some banks (Vietcombank, BIDV) distribute government bonds. Minimum value usually from 50-100 million VND. Advantage: simple process if you're already a bank customer. 3. Through bond ETFs: Invest in funds like VFMVFB ETF on the HOSE exchange. Minimum value: from a few hundred thousand VND. Advantage: low cost, high liquidity, suitable for small investors. Pocket Option provides a government bond trading platform with the lowest market transaction fee (only 0.05%) and real-time yield comparison tools between different terms.<