ETF Dictionary

Explain ETF Term: What is Asset allocation

Embarking on the journey of ETFs in the dynamic Vietnam market, it’s crucial to grasp the fundamental concept of “Asset Allocation” with KIS Prime ETF. 

1. What is Asset allocation ? 

• Asset allocation is a smart way to spread your money across different types of investments in your portfolio. These investments can include stocks, bonds, cash, and other financial tools. Imagine it like having a mix of different ingredients in your cooking pot.
• An asset allocation exchange-traded fund, is like a ready-made mix of investments. It’s made up of many small parts, just like different shares in a big basket.
•  Goal is to balance the risk and reward based on what you want to achieve with your money and how much risk you’re comfortable with.

2. Asset Allocation Strategies for Vietnam ETF

• In the Vietnamese ETF landscape, mastering asset allocation is a strategic tool for investors. By diversifying across asset classes help to optimize returns while managing risk. 
• An asset allocation can be viewed as figuring out way to divide the money wisely. This is where asset allocation comes into play. By spreading the money across different types of investments, investors can make the most of returns while also making sure you’re not taking on too much risk.

• Example: A Newbie Investor’s Approach:

A Newbie Investor, named Ms. Nguyen, she’s excited to start her investment in Vietnam market by investing $30,000 into the E1VFVN30 ETF offered by KIS Vietnam. This ETF is like a mix of the top 30 companies in Vietnam, allocates a substantial portion of its assets to the top 30 companies listed on the HOSE.

• Ms. Nguyen’s Goals:

1. 1. => Diversification: Desire to spread her money across different sectors to lower the risk.
   2. => Gain Potential: Benefit from the growth of various sectors in Vietnam’s market.

• Her Money investment Breakdown into ETF E1VFVN30 VN30: 

Financial Services (20%): $6,000 Consumer Goods (15%): $4,500 Technology Sector(10%): $3,000 Manufacturing (15%): $4,500

Material (10%): $3,000 Real Estate (10%): $3,000 Energy (10%): $3,000 Others (10%): $3,000

=> Investing in the “E1VFVN30” ETF provides Ms. Nguyen with a strategic asset allocation framework, gives Ms. Nguyen a smart way to spread her investment and reduces the risk.

This highlights the strategic and practical aspects within the context of Vietnam’s stock market. Feel free to customize this academic blog further based on specific offerings from KIS Vietnam.

Stay informed, adapt to market changes, and consider consulting with financial experts to tailor your allocation strategy for long-term success in ETF investments.