PXP’s Snowball says Vietnam stocks needed to ‘calm down’

VNStockNews.com - We have, actually retraced a fairly large amount of that [the previous gains] about 30%. The market got up to about 520 and we’re back down to 430 now and looking slightly weaker.

I mean I just think we got ahead of ourselves. We went from eight times earnings to 16 times earnings, given the fact that we’re still waiting to see concrete evidence that the world is coming out of its depression.

It just needed to relax and calm down, consolidate a bit before going higher again hopefully.

We’re long-term investors – that’s definitely the way to look at this market. But, as I say, we’ve seen probably a 20% increase in market capitalization in the last week or so from a couple or two new listings which is obviously allowing the huge volume or huge increase in turnover to be spread around a bit more.

But given that this is the market that at the bottom in February was struggling to do US$10 million a day in turnover, we got up to over $200 million a day.

We never thought that was a sustainable level of turnover, given there’re concerns about the future direction of currency. At some point other investments became relatively more attractive than the market that is up 100 percent in three months.

Kevin Snowball,
co-founder and portfolio manager at
PXP Vietnam Asset Management.


(Bloomberg)