VNM vs VNAM vs KPHO: Which Vietnam ETF Should You Buy? (2026)

Last updated: February 28, 2026 (Originally published: February 27, 2026)

TL;DR: There are now three US-listed Vietnam ETFs. VNM ($609M AUM, 0.68% fee) is the oldest and most liquid. VNAM ($25M, 0.51%) is cheaper but tiny. KPHO (launched Dec 2025, sub-$10M) is the only one that accesses full-FOL stocks through the Diamond ETF. For most investors, VNM is still the default. For FOL-aware investors who understand the premium, KPHO is the most interesting newcomer in years.

For years, US investors who wanted Vietnam exposure had essentially one choice: VNM. Then VNAM showed up in 2021 offering a lower fee. And in December 2025, KPHO arrived with a genuinely different approach — one that solves the foreign ownership limit problem that has plagued both VNM and VNAM since inception.

This is the comparison I wish I’d had when I started allocating to Vietnam ETFs from the US. Let me break down each fund, then tell you which one I’d pick in different scenarios.

The Head-to-Head Comparison

*KPHO’s expense ratio is expected to be competitive but full data is still being established given its December 2025 launch. AUM figures as of early February 2026.

Let me walk through each fund in more detail.

VNM: The Incumbent

VNM is the granddaddy of Vietnam ETFs, launched by VanEck in August 2009. At ~$609 million in AUM, it’s the largest and most liquid option by a wide margin. If you Google “Vietnam ETF,” VNM is what comes up.

What’s good:

Liquidity. VNM trades with tight bid-ask spreads and healthy daily volume. It’s the only Vietnam ETF with an options market, which matters if you want to write covered calls or hedge with puts. For a single-country ETF focused on a frontier-to-emerging market, this level of liquidity is rare and valuable.

Track record. VNM returned +66.5% in 2025 — one of its best years ever. Over 10 years, the annualized return is roughly 4.5%, which looks modest but includes the brutal 2022 drawdown (-43.7%) when Vietnam’s real estate/banking sector imploded. The fund has survived multiple market cycles and proven its durability.

Diversification within Vietnam. The 8% single-stock cap prevents any one company from dominating the fund. This is a meaningful advantage over VNAM, which allows up to ~25% in a single name.

What’s not great:

The expense ratio of 0.68% is steep for a passive ETF. Over 10 years on a $50,000 investment, that’s roughly $3,400 in fees — versus ~$2,550 for VNAM at 0.51%.

The FOL problem is VNM’s structural weakness. Because VNM is a foreign-domiciled fund, it cannot buy Vietnamese stocks that have reached their foreign ownership limits. This means VNM has historically excluded some of Vietnam’s best-performing companies — FPT, MWG, TCB, ACB — when those stocks were at full room. This directly explains why VNM has underperformed the VN-Index over long periods.

For my detailed analysis, see the full VNM ETF review.

VNAM: The Cheaper Alternative

Global X launched VNAM in December 2021, offering a lower-cost alternative tracking the MSCI Vietnam Index.

What’s good:

The 0.51% expense ratio saves you 17 basis points per year versus VNM. On a $50,000 position over 10 years, that’s roughly $850 in savings. Not life-changing, but it compounds.

MSCI index tracking could become more relevant if MSCI eventually upgrades Vietnam from Frontier to Emerging (estimated 2027-2030). If that happens, VNAM’s underlying index would naturally align with institutional flows.

What’s not great:

At ~$25 million in AUM, VNAM is tiny. This creates wider bid-ask spreads, lower daily volume, and closure risk. If assets don’t grow meaningfully, Global X could shut the fund down — as has happened with other small single-country ETFs. No options market, which limits strategy flexibility.

Concentration risk is real. VNAM’s methodology allows Vingroup (VIC) to reach ~17% of the fund, compared to VNM’s 8% cap. In a market where Vingroup alone represents a massive chunk of the index, that’s a lot of single-stock risk.

Same FOL problem as VNM. VNAM cannot access full-room stocks either. The structural weakness is identical.

KPHO: The Newcomer That Changes the Game

This is the fund that got my attention. KPHO launched on December 4, 2025, just two months after the FTSE upgrade announcement. It’s a partnership between KraneShares (the issuer) and Dragon Capital (sub-advisor) — and Dragon Capital is Vietnam’s largest fund manager by assets, with over 30 years of on-the-ground experience.

The FOL breakthrough:

KPHO is the only US-listed Vietnam ETF that provides access to stocks at or near their foreign ownership limits. It does this by investing in Dragon Capital’s locally-listed Diamond ETF (FUEVFVND) for FOL-constrained stocks. Because the Diamond ETF is a domestic Vietnamese fund, it faces no foreign ownership restrictions — so it can hold MWG, TCB, ACB, and other “full room” names that VNM and VNAM cannot touch.

This is structurally significant. As I explained in the FOL guide, the stocks that hit their foreign ownership limits tend to be the ones foreigners want most — often the highest-quality companies. By excluding them, VNM and VNAM have systematically missed some of Vietnam’s best performers. KPHO doesn’t have this blind spot.

Fundamental screening:

Unlike VNM and VNAM which are purely market-cap weighted (with caps), KPHO uses a fundamental screen based on P/E ratios, asset-to-equity ratios, and a proprietary growth metric. As of early February 2026, KPHO’s average P/E was just 9.7 — compared to 17.2 for the MSCI Emerging Markets Index. That’s a meaningful value tilt.

What’s not great:

It’s brand new. Less than three months old at the time of writing. AUM is under $10 million. Average daily volume is around 11,000 shares. The bid-ask spread can be wide. This is emphatically not a fund for large institutional allocations yet — it needs time to build liquidity and track record.

Complexity. The Diamond ETF wrapper adds a layer of fund-within-a-fund structure. You’re paying KPHO’s expense ratio plus the embedded costs of the Diamond ETF. The total cost of ownership may be higher than the headline expense ratio suggests.

And there’s the simple fact that KPHO launched into a market that had already rallied 70%+ in 2025. Timing isn’t great for historical performance comparisons.

Performance Context: 2025 Was Exceptional

Before choosing any of these ETFs, understand the backdrop. Vietnam ETFs delivered extraordinary returns in 2025 — VNM +66.5%, VNAM roughly +70% — driven by the FTSE upgrade announcement, strong GDP growth (8% for the year), and a massive VN-Index rally.

But zoom out. VNM’s 5-year annualized return is only about 3.9%, and its 10-year return is ~4.5%. The 2022 drawdown of -43.7% wiped out years of gains. Vietnam ETFs are volatile — significantly more so than broad emerging market funds. The risk profile of Vietnam investing is something you need to understand before committing capital.

Here’s VNM’s annual return history for context:

The takeaway: Vietnam is a high-conviction, high-volatility bet. The ETF you pick matters less than your conviction in the market itself and your ability to hold through drawdowns. For what realistic long-term returns look like after factoring in currency drag and taxes, see my yield analysis.

The FTSE Upgrade Factor

After September 2026, when the FTSE reclassification takes effect, a new option emerges: Vietnam exposure through broad emerging market ETFs like VWO (Vanguard FTSE Emerging Markets) or SCHE (Schwab FTSE Emerging Markets).

These funds will add Vietnam as a small allocation — likely in the low single digits initially. This is convenient (no separate ETF purchase needed) but provides minimal exposure. If you’re reading this article, you probably want more than a 1-2% Vietnam weight in your portfolio.

The single-country ETFs (VNM, VNAM, KPHO) will remain relevant as satellite or tactical positions for investors who want concentrated Vietnam exposure.

Who Should Buy What: My Framework

Based on the data and my own experience investing in Vietnam from both the US and locally, here’s my decision framework:

Choose VNM if:

You want the safest, most liquid Vietnam ETF. You value the options market for hedging or income strategies. You’re making a position of $50,000+ and need reliable execution. You plan to hold for 3-5+ years through a market cycle. VNM is the default — it’s not perfect, but it works.

Choose VNAM if:

You’re fee-sensitive and the 17bps savings matter to your portfolio. You believe MSCI index alignment will become important (Vietnam MSCI upgrade). You’re comfortable with lower liquidity and higher single-stock concentration. Honestly, VNAM’s tiny AUM is its biggest risk — I’d want to see it cross $100M before making it a core holding.

Choose KPHO if:

You understand the FOL problem and want exposure to Vietnam’s best companies without the artificial exclusion. You trust Dragon Capital’s track record (they’re the gold standard for Vietnam fund management). You’re willing to accept early-stage fund risks (low AUM, low volume, potential bid-ask spread costs). KPHO’s Diamond ETF access is a genuine competitive advantage — the question is whether the fund can build enough scale to survive and thrive.

Choose direct investment if:

You want full control over stock selection, including access to mid-caps and small-caps that no ETF covers. You’re willing to navigate the brokerage setup, VND currency, and time zone challenges. Your conviction is high enough to justify the work. If this is you, start with my complete guide and best brokers comparison.

What I Actually Do

Full transparency: I invest directly in Vietnamese stocks through local brokerage accounts. I live in Saigon, I speak Vietnamese, and I have the time and access to manage individual positions. For someone in my situation, ETFs are suboptimal — I’d be paying 0.5-0.7% per year for a basket I can build myself at lower cost.

But if I were still living in the US and wanted Vietnam exposure? I’d split between VNM (for liquidity and the options market) and KPHO (for FOL-stock access), with a roughly 60/40 split. I’d give KPHO 6-12 months to build AUM before increasing the allocation. And I’d use VNM options for tactical hedging around events like Tet or FTSE rebalancing dates.

That said, I’d also seriously consider opening a Vietnamese brokerage account remotely (it’s possible) and doing a hybrid approach: ETFs for core exposure, direct ownership for high-conviction picks from my blue chip watchlist.

The Bottom Line

Three US-listed Vietnam ETFs, three different approaches:

VNM = the Toyota Camry. Reliable, liquid, proven. Not exciting, but gets the job done. Overpays in fees and misses FOL stocks.

VNAM = the cheaper Honda Civic. Same road, lower sticker price. But the engine is small (low AUM) and the warranty is uncertain (closure risk).

KPHO = the new Tesla. Innovative design (FOL access via Diamond ETF), backed by smart engineering (Dragon Capital), but unproven in the real world. Early adopters may be rewarded — or may face early teething problems.

None of them perfectly captures the Vietnamese market. All of them give you meaningful exposure to one of Asia’s fastest-growing economies ahead of a historic index upgrade. The best choice depends on your portfolio size, risk tolerance, and whether you understand what FOL exclusion actually costs you.

Frequently Asked Questions

Keep Reading

• VNM deep dive: VNM ETF Review: Should You Buy Vietnam’s Biggest ETF?
• Understand FOL: Foreign Ownership Limits: The FOL Guide Every Investor Needs
• The catalyst: FTSE Russell Vietnam Upgrade: What It Means
• Top stocks: Top 10 Vietnam Blue Chips for 2026
• Open your account: How to Open a Vietnam Brokerage Account (Step-by-Step)
• Realistic returns: Vietnam Yield: What Returns Are Realistic for USD Investors?
• Risk overview: Is Investing in Vietnam Safe? The Honest Truth
• Start here: Invest in Vietnam: A Complete Guide for Americans

Sources: VanEck, Global X, KraneShares, Dragon Capital, Yahoo Finance, ETF Database, ETF Trends, Seeking Alpha. Performance and AUM data as of early February 2026. Past performance does not guarantee future results.