VNDIRECT: VFMVN30 will sell CTD, BVH, and buy KDH and TCH

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CTD and BVH may be removed from VN30, replaced by KDH and TCH

According to VNDIRECT Securities (VND), CTD’s share price has decreased by 32% since June 2019 mainly due to the conflict of interest in the Board of Directors and the unfinished construction segment. Therefore, the average annual market capitalization of the stock has decreased to about VND 5,700 billion, which is no longer on the VN30 basket list – including 40 stocks with the largest market capitalization.

And BVH is a stock with a low free transfer rate, with an actual freefloat rate of about 9%. BVH has been included in the VN30 basket in previous periods thanks to the freefloat adjusted market cap large enough to overcome the priority freefloat condition in the HOSE-Index rules. However, according to VND data, BVH may be excluded in this period because the adjusted market capitalization of freefloat is not large enough to overcome the priority freefloat conditions.

With CTD and BVH excluded from VN30, KDH and TCH are eligible stocks in the VN30 basket in this period, with market capitalization ranked 26th and 30th on the VN30 basket filter list.

VFMVN30 ETF will restructure the portfolio based on changes of VN30

The effective date of the new index basket is August 3, 2020, which means that the VFMVN30 ETF, based on the VN30 index, will restructure its ETF portfolio on the previous trading day (July 31 / 2020).

With a fund size of over VND 5,100 billion, VFMVN30 will sell about 590,000 CTD shares (0.53% of the current portfolio value) and 270,000 BVH shares (0.42% of the current portfolio value). At the same time, VFM will buy about 3 million KDH shares (1.42% of the new portfolio value) and 1.7 million shares of TCH (0.7% of the new portfolio value). VFM will also conduct activities to buy / sell other stocks to restructure the proportion of shares in the ETF to equal the proportion of new shares in VN30.