Things the foreigner need to know before opening a stock account for in Vietnam

Things the foreigner needs to know before opening a stock account in Vietnam

The instruction of opening a stock market for foreign investors (opening indirect investment account)

But if you can not communicate by Vietnamese, you may feel difficult to understand the content of the brokerage contracts and other services. Besides it is also hard to ask the office staffs (who give you prepared contracts) to explain the detail of terms because of their limitation of English skill and their working time.

Thing you need to know for investing in Vietnam's stock market

The language barrier is one of the biggest issues to the foreign investors.

We advise you should completely understand all of the contract content you sign. In general, when opening a stock account in Vietnam you may sign 3 contracts with the brokerage securities company. They are the contract of opening a stock account, margin contract, and internet banking transfer. Contact us we will help you understand fully every the contract’s content.

Here below we recommend some details you must know before signing the contract:

1. Make clear all the fees that you may pay when signing the opening account contract.

Basically, the process for opening a stock account is like opening a bank account. However, the procedure takes some more steps with foreigners.
Trading fee: the Trading fee is the most noticeable fee should pay your attention. In the case, if you trade frequently, it’s worth the most.  Click here to find out some companies’ fees.
Besides trading fee, you should take a look at other fees such as transacting through call center, receiving account information and market research information by text message, online trading, receiving monthly statement via email…

2. Margin lending contract

There are some points of the contract you need to make clear such as margin call rate, margin loan rate and lending rate of tickers before opening a stock account. Call margin rate: A margin call is a broker’s demand on an investor using margin to deposit additional money or securities so that the margin account is brought up to the minimum maintenance account. Margin calls occur when the account value depresses to a value calculated by the broker’s particular formula.
Recently, the margin interest rate around 13%/year is acceptable in Vietnam’s market.
According to Vietnam securities law in 2015, foreigners don’t permit to use margin lending services excepting some particular cases.

3. Internet banking transfer

Internal transfer rate fee for transferring your money from a stock account to a bank account. You should aware which local banks are associated with the securities company that you open the stock account to avoid the transferring fee.
In Vietnam, BIDV is the only local bank having authorization to custodize foreigners’ stock and money (through foreign indirect investment account).

 

 

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