SHS CEO on Family Asset Allocation: Assess Your Ability to Meet Expenses First
SHS CEO Nguyễn Duy Linh says families should review their financial goals, future obligations and liquidity before allocating assets, and set an acceptable loss limit for each investment. He also discusses changes to his portfolio and his view of Vietnamese stock market valuations.
At a forum discussing asset allocation among Vietnamese families, Nguyễn Duy Linh, CEO of Saigon-Hanoi Securities JSC (SHS), said many families focus on investment returns while overlooking an assessment of their overall financial capacity. Before deciding how to allocate assets, they should review their financial goals, future payment obligations and available funds to avoid being forced to sell valuable assets because of a cash flow shortage.
Nguyễn Duy Linh, CEO of Saigon-Hanoi Securities JSC (SHS). Photo courtesy of the event organizers.（VietVance）
He recommended managing risk in three ways: ensuring that potential investment losses would still leave enough to cover essential expenses for the next 6 to 12 months; setting a maximum acceptable loss for each asset in advance; and weighing expected returns against potential losses. As an example, he said investors may repeatedly change their holding strategy as a stock continues to fall, only to be forced to sell when faced with a margin call.
On the roles of different assets, he said bank deposits can meet liquidity needs but still face risks such as inflation; fixed income assets can provide relatively stable cash flow, but investors must examine issuers and their ability to repay debt; stocks offer growth potential, while real estate investments require a clear goal of capital appreciation or rental income.
Regarding his own portfolio, Nguyễn Duy Linh said he is reducing the share of assets held for liquidity, raising his allocation to fixed income assets to about 30% to 40%, and gradually increasing his stock holdings. He said that, excluding stocks in the Vingroup ecosystem, the market's current price-to-earnings ratio is about 9.3 to 9.4 times; if corporate profits grow by 15% to 17%, SHS estimates that the ratio could fall to about 8.5 times. He gives less priority to real estate and gold, and stressed that his personal allocation approach is not a universal model for all families.
Source: VietVance
