VIETNAM NATIONAL UNIVERSITY - HA NOI UNIVERSITY OF ECONOMICS AND BUSINESS GRADUATION THESIS OUTLINE 2023 RESEARCHING THE BOTTOMING PROCESS OF THE STOCK MARKET: OPPORTUNITIES AND CHALLENGES IN THE NEW CYCLE Lecturer: PhD. To Lan Phuong Student: Nguyen Phuc Minh Quang ID Student: 19050720 Class: QH2019E-TCNH-CLC 3 Hanoi, 2023 Statement of authorship I hereby declare that my graduation thesis on the topic "Researching the bottoming process of the stock market: Opportunities and challenges in the new cycle" is an independent study conducted by me. The data provided is from the thesis report and the research results are completely honest. The thesis is not plagiarized or copied from any other research work.
All cited materials are clearly referenced. I fully take responsibility before the university if any misconduct or plagiarism is found in this thesis. To complete this thesis, I would like to express my gratitude to the esteemed professors of the Faculty of Finance and Banking, University of Economics and Business - VNU for providing opportunities for learning, honing skills, and accumulating knowledge to carry out this thesis. And especially, I would like to extend my gratitude to Dr.
To Lan Huong, who is the supervisor of the Department of Finance and Banking. She has directly guided and assisted me throughout the process of conducting the thesis. Thanks to her dedication, passion, meticulous knowledge, and straightforward contributions and comments, she has helped me to complete the thesis smoothly. Lastly, I would like to wish esteemed professors good health and continued success in their work.
Thank you sincerely for your valuable contributions and support. Hanoi, May 11th, 2023 Student Nguyễn Phúc Minh Quang Acknowledgments Investors in the Vietnam stock market consider the stock market's bottoming process and the opportunities that arise when entering a new cycle to be of utmost importance. As the global economy develops at a rapid pace, the stock market has become a sector with significant influence on economic development. However, the stock market also faces challenges and opportunities during its development.
To gain a deeper understanding of the stock market's bottoming process, as well as the challenges and opportunities that arise when entering a new cycle, I have chosen this topic for my thesis. The study will focus on the period from 2020 to 2022 to better understand market volatility and industry trends. By conducting research and analysis, I aim to provide useful conclusions and solutions that will assist investors, businesses, and market regulators in making more accurate and effective decisions in their activities. Table of Contents Table of contents, Charts, and ÏImaS.
--- «cà sen sen sen sex rrrxekreesrersrae Table of contents, Charts, ANd iMAGES .c«5Ă 5555 1Snhtittrsrrsrrrsrsrsrsrarsrrsrrsrsee 5 Chapter I: Introduction Of the R€SCAPCH wissen 1 1. Reasons for choosing the tOPiC. The distribution Of PCSCOTCH iressesssssesesssessssessssssessssessssessssssssassssssssssisesssasessasssssssssasesssasensaessnasessaessies 1 1. Target audience Of the reSCArCHeresssesscssssssssiesssnessssssesessssessssssnssssssnessssssesessssnsssssissssnnessssneisssiaes 2 1.
Objectives Of the TESCO CH iiressescsssesssesssesssssssnssssssssssessssssessassssssssssnsessssessissssesessisssasssnieessnsesnnessies 3 1.5, Research SCOpe Of the ÊODÍC. Methods Of the reS@ar ch vrsesesssescsssscsssssesssssssssssssnsssssesessssessssssssusessssssssasesssesessacesssssessaessierensasesssesessasessias 4 Chapter II: Research overview on the bottom-making process of the stock market and investment opportunities in the NOW PCTIOd. Lite rAture VOVICW waeesecssescsssesseesssesnsessssssesssessssssnsessnsssssessscsssssssssssicssnsesscssnsesnecsssessasesnicssaresnsesnessieesnsesses 5 2. Foreign COCUMENES FESCALCH eeesssssscessssssesssssseesssesesssssssessssssssssssssssssesessssssessssssesssuesesssassessssssesssaestsy 5 2.
Domestic COCUMENES TESCO CH varesssessssescssssssssessssnessssasesssssessassssnssessavsssnsssssasessiscessassssissessaressisesssasesty 6 2. Theoretical basis for the researching the Bottoming Process of the Stock Market: Opportunities and Challenges in the NEW CYCIl. OvervieW Of StOCK MAKE ueessesscsssesecsssessesssesesssnesesssssssssssesssssusesssnetesssssssssssusesssnetesssnssesssnnstessnaasestey 8 2. Definition of stock market Chapter III: Research MetHodology eursesesessssssssssssssssscssecssscsesensnesensnsnscsscsnsesnsessssnsssnsseseseses 14 3.
Define research PrODleMevssesscsssssssssseesssssesssssessssesessssssessssssesssssssessssssessssssessssssssssusessssssesssassssssese 15 3. RESCALCH CONCEP erresessssssssesessuessssssessusssssusessssesssusessnscessusessusssssucessusessnscessusessuscessucessnscessavessnsessacessuscessases 16 3. Method of In-Depth Interview 18 3. Implementation of In-Depth Interviews 18 3.
Target Group for In-Depth Interviews 18 3. Processing ofIn-Depth Interview Data 18 3. Model for Qualitative Research 19 3. Model for Quantitative Research 19 Chapter IV.
The results Of r€S€@@TCH. The results Of SUTVEY vessssesesssseseesssesessssissssssnssssssnisesssssessssiesssssersssssnssessssssessssassssssnssesssnsesssnisesssnaesssnaes 20 4. The results of In-depth interview. The results Of Amir ImOđ6lL.- sen HH HHHH10071111017111111071111711120.4 The discussion Of T€S€@@TCH.
32 Chapter V: Conclusion and recOMMENAALION .--ee-cccccccrkeirrriitrriiitktiiitrrirrrriiirriirrrriiiriirrriirrriirrrriirrrrrrrrisrrkrrrrrrrrrrkee 38 REfCTENCES. 7 Sằ stress 44 Table of contents, charts, and images List of table Table 4.1: Summary of Market Bottom Formation Dates for Different Sectors. 36 List of Charts and Images Figure 3.1: Stock market bottom in Vietnam in 2020. - -c- se ecree 27 Figure 4.2: Performance after 20 days of market bottom formation across sectors.3: Performance after 60 days of market bottom formation across sectors.4: Sharpe Ratio of sectors after the market bottom formation phase.5: Performance after 250 days of market bottom formation by sectors.6: Performance after 500 days of market bottom formation by sectors.7: Stock Market B€tA.
- --- cà HH HH HH HH KH HH ke 33 Figure 4.8: Max Drawdown Index by Sectors afterMarket Bottom Formation.9: Overview and Evaluation of Sector Performance .ceccsseeecseceeeseeee esac 35 Figure 5.1: Growth Rates of All Sectors After the Market Bottom Formation.1: Proportion of people who voted for students or have started working.2: Estimate percentage loss Curing 2020. - «ch HH re 21 Chart 4.3: Proportion of investment sector preferences in 2019.4: Proportion of sector preferences after the bottom formation phase.5: Proportion of market bottom formation predictions in the next year. 25 Chapter I: Introduction of the Research 1. Reasons for choosing the topic There are several reasons why one might choose the topic "Researching the bottoming process of the stock market in Vietnam: Opportunities and challenges in the new cycle." Here are a few possible reasons Importance in the economy: The stock market holds immense economic significance for Vietnam as it impacts the overall economic situation, investor sentiment, and potential growth.
Gaining insights into the process of stock market bottoms can guide informed decision-making for investors and policymakers. Volatility of the market: Vietnam's stock market, like others, is known for its volatility. Exploring the bottoming process provides valuable understanding of market fluctuations, patterns, and dynamics, empowering investors and analysts to navigate market cycles, identify turning points, and manage risks more effectively. Boosting investor confidence: The transition from a bear to a bull market is often associated with stock market bottoms.
Researching this process enhances investor confidence by delving into the factors that drive market recoveries. This knowledge benefits individual and institutional investors, as well as market regulators. Policy implications: Governments and regulatory bodies seek to comprehend stock market behavior and trends to develop appropriate policies and regulations. Analyzing the bottoming process offers insights into policy effectiveness and suggests potential adjustments or interventions to foster a stable and sustainable stock market environment.
Distinctive characteristics of the Vietnamese market: Each stock market possesses unique attributes and challenges. Vietnam's market has experienced notable growth and transformation, attracting domestic and international investors. Research on the bottoming process in Vietnam uncovers specific opportunities and challenges unique to the market, such as regulatory frameworks, market liquidity, investor behavior, and the impact of global economic trends. The distribution of research The research on the bottom formation process of the Vietnamese stock market provides valuable insights into the market's dynamics and trends.
It helps investors and analysts better understand the opportunities and challenges when entering a new cycle of the stock market. By analyzing the performance of different industries during the bottom formation process and after 20, 60, 250 and 500 days, the research sheds light on the industries' potential and risks, providing valuable information for investors to make informed decisions. The research also highlights the shift of money flow towards certain industries, which can help investors identify potential investment opportunities. Overall, the research contributes to the understanding of the Vietnamese stock market and provides investors with useful information for making investment decisions.
Target audience of the research This research on the formation process of the Vietnamese stock market bottom targets a diverse audience comprising investors, analysts, and individuals seeking a deeper understanding of the market's dynamics and trends. The study offers valuable insights and information that can guide investors and analysts in making well-informed decisions when entering a new stock market cycle. Financial institutions, including banks and investment firms, can also leverage the research to develop effective investment strategies and products. Moreover, policymakers and regulators within the financial sector can benefit from the research by gaining a comprehensive understanding of the stock market's performance, thereby enabling them to make informed decisions regarding market regulations and policies.
Therefore, the study raises the following issues through the questions: + What are the industries that investors should and should not invest in during the market recovery period, based on the research on the bottoming process of the stock market? + How did the process of forming the bottom of the Vietnamese stock market unfold in 2020, and which industries bottomed out first and later? + What were the expectations and realities for investors during the year 2020? + What opportunities and challenges arise when transitioning into a new cycle of the Vietnamese stock market? 1. Objectives of the research The objectives of researching the bottoming process of the stock market in Vietnam can vary depending on specific research goals. However, there are several common objectives that can be considered: 1. Understanding the bottoming process: The primary objective is to develop a comprehensive understanding of the bottoming process in the Vietnamese stock market.
This involves studying market cycles, identifying key indicators and factors that signal a potential market bottom, and analyzing patterns and dynamics of market recoveries. Identifying opportunities: Another objective is to identify opportunities that arise during the bottoming process. This includes recognizing undervalued stocks or sectors with potential for future growth, as well as identifying investment strategies that are effective during the transition from a bear market to a bull market. Assessing challenges and risks: Research should also focus on assessing challenges and risks associated with the bottoming process.
This involves analyzing factors that may hinder market recovery, such as economic indicators, regulatory issues, geopolitical risks, and investor sentiment. Understanding these challenges can help investors and policymakers make informed decisions and develop strategies to mitigate risks. Examining market behavior and investor sentiment: Researching the bottoming process should involve examining market behavior and investor sentiment during different phases of the market cycle. This includes analyzing the psychology of investors, their decision-making processes, and the impact of emotions on market trends.
Understanding investor sentiment helps gauge market expectations and potential shifts in sentiment. Providing recommendations and insights: The objective of the research should be to provide practical recommendations and insights based on the findings. This may include suggesting investment strategies, policy adjustments, risk management techniques, or market interventions that can help investors and policymakers navigate the bottoming process more effectively. Research scope of the topic Begin by conducting a historical analysis of the Vietnamese stock market, examining past market cycles and identifying significant bottoming processes.
This analysis will provide insights into the duration, patterns, and characteristics of market bottoms in Vietnam. The research aims to investigate key market indicators associated with market bottoms, assess sector performance during the bottoming process, examine investor behavior and sentiment, identify investment opportunities and challenges, and define the research scope. This includes analyzing indicators' behavior, evaluating their predictive power, identifying resilient sectors, understanding investor psychology, and suggesting strategies for identifying undervalued stocks. It emphasizes the importance of defining the study's time period and data sources, considering available resources, and ensuring a realistic research scope.
Methods of the research In researching the bottoming process of the stock market in Vietnam, | utilize 3 main methods: the Survey Method, In-depth Interview and Amira model. These methods provide valuable insights and perspectives from various stakeholders in the market, allowing for a comprehensive understanding of the dynamics and trends during the bottoming phase. Chapter II: Research overview on the bottom-making process of the stock market and investment opportunities in the new period 2. Foreign documents research These research papers offer valuable insights into different facets of the stock market's bottoming process, encompassing areas such as timing strategies, investor sentiment, market dynamics, and prediction models.
They present significant perspectives and findings that contribute to enhancing our understanding of the opportunities and challenges that arise during the emergence of a new cycle of stock market bottoms.