95% of individual investors lose money in the stock market, average investment life is only 2 years
The Vietnamese stock market has recorded remarkable growth in the number of individual accounts in recent years, but behind the figure of "10 million accounts" is a worrying reality: 95% of individual investors lose money and leave the market after only about 2 years of participation.
The above information was announced at the workshop "Raising investor awareness towards upgrading the stock market" held in Hanoi on July 17. According to data from the Vietnam Securities Depository and Clearing Corporation (VSDC), by the end of June 2025, Vietnam had more than 10.2 million securities accounts, of which individual investors accounted for 99.82% and performed over 80% of the total market transaction value.
Herd mentality and lack of financial knowledge are the main causes
Speaking at the workshop, Ms. Nguyen Ngoc Linh, General Director of DNSE Securities Company, said that most individual investors are still trading based on emotions, lack analytical knowledge and are easily influenced by the crowd. This makes them prone to making wrong decisions during periods of strong market fluctuations.
Mr. Nguyen Son, Chairman of VSDC Board of Directors, emphasized that only about 50% of accounts actually have regular trading activities, showing that a large proportion of investors withdraw or "freeze" their accounts after losses. He also pointed out the common characteristics of Asian investors in general, which are their preference for individual investment and their limited use of professional asset management organizations, leading to poor risk management capabilities.
The stock market needs to “transform” to upgrade
Vietnam is facing the opportunity to upgrade its market from “frontier” to “emerging”, a turning point that could help attract strong foreign capital flows and improve market depth. However, according to Mr. Nguyen Son, improving knowledge and discipline for individual investors is a key factor in this transformation process.
The proposed solutions include:
Promoting training and disseminating investment knowledge through digital platforms and traditional channels
Encouraging the development of professional investment organizations, such as investment funds, asset management companies, and insurance companies
Developing tax incentives for long-term and professional capital flows
Technical infrastructure and policies are also being upgraded
Mr. Bui Hoang Hai, Vice Chairman of the State Securities Commission, said that Vietnam has met most of the criteria for upgrading, but the “decisive key” still lies in the assessment from foreign institutional investors.
In the first half of July, foreign investors returned to net buying more than VND13,000 billion, largely thanks to the implementation of non-margin trading (NPF) to reduce technical errors, shorten settlement times and improve transparency.
In addition, the management agency is also coordinating the implementation of the Central Clearing Partner (CCP) model, expected to be completed within the next 12-18 months. Efforts to improve administrative procedures, promote information disclosure and develop financial products in the direction of ESG (Environment - Society - Governance) are also being strongly promoted.
The dream of making a profit is not easy to achieve without knowledge
In the context of strong stock valuation increases since the beginning of 2024, many new investors seem to be disoriented in choosing stocks, especially after short-term adjustments. Many people who entered the market with the expectation of “making money quickly” have paid a heavy price due to lack of basic knowledge and investment discipline.
However, the market still has attractive opportunities for those with a clear strategy. Smart investment support tools, data analysis and optimized portfolios are playing an increasingly important role, especially when investors start looking for long-term growth strategies instead of short-term surfing.
Conclusion
The stock market is not only a financial playground but also a test of knowledge, psychology and patience. The fact that 95% of individual investors lose money within two years is a clear warning for both investors and managers. For the Vietnamese stock market to truly develop sustainably and qualify for upgrading, the maturity of individual investors must go hand in hand with infrastructure reform and macroeconomic policies.