"Good to see the Vietnam market come to life in recent days. However, the sharp ascent of the Vietnam Stock Exchange Index (VNINDEX) isn't matched by the FTSE Vietnam index or the db x-trackers Vietnam ETF (XFVT) and the Dong has been pretty stable. I guess it's all down to the constituents of these indices/funds, but your observations, as always, would be most welcome.

David Fuller's view You are right; the index tracked is an important factor. However I think currency has been a medium-term factor. XFVT (weekly & daily) is sterling-denominated and GBP has been in a ranging uptrend against the dong since January 2009, as you can see from this chart of GBPVND. The issue is complicated because XFVT tracks the FTSE Vietnam Index, for some reason unknown to me, which is euro-denominated. I assume there are hedging charges which would add an additional expense.

Trackers may sound like a good idea, not least because most managed funds do not match their benchmark index, after expenses are deducted. However I have three main reservations about trackers, which you may have seen in my copy on 13th January:

1) To maintain weightings they bid up the price of popular and ultimately overvalued shares in the index, at the expense of undervalued components; 2) This activity increases the tracker's share dealing costs, as do changes in the index; 3) The index in question may not provide the coverage that one might prefer.

Fullermoney has frequently mentioned Vietnam (weekly & daily) as a recovery candidate in recent months. This is still our view and the market has begun to perform recently. I do still have a small position in XFVT in one of the family ISA accounts. I really should sell this and reinvest the money in one of the managed funds or investment trusts listed under 'Vietnam' in the chart Library.