The Volatility of Market Risk In Viet Nam Listed Banking, Insurance and Financial Services Company Groups after the Financial Crisis 2009-2011

Abstract

The Viet Nam economy, especially the stock exchange, has been influenced by the global crisis during and after the period 2007-2009. How much risk for a typical industry in an emerging market such as Viet Nam? For specific industries, such as banking, insurance, investment and security industries, the risk re-analysis and estimation for the listed firms in these industries become necessary, esp. after the crisis period 2009-2011. First of all, by using quantitative and analytical methods to estimate asset and equity beta of four (4) groups of 32 financial service listed companies in Viet Nam banking, insurance, investment and security industries with a proper traditional model, we found out that the beta values, in general, for most companies are acceptable, excluding a few cases. There are 81% of listed firms with lower risk, among total 32 firms, whose beta values lower than (<) 1. This number is higher than that during the crisis period 2007-2009 (just 69%, see Exhibit).Secondly, through the comparison of beta values among four (4) above industries, we recognized there are still 19% of total listed firms in the above group companies with beta values higher than (>) 1and have stock returns fluctuating more than the market index. Finally, this paper generates some outcomes that could provide both internal and external investors, financial institutions, companies and government more evidence in establishing their policies in investments and in governance.