ASEAN Inc.: Up 16% Since December 31, 2024 — A Region Outperforming Quietly, While Investors Look the Other Way

Key Takeaways

• ASEAN Inc. delivered 16.1% total return to March 2026
• Vietnam ETF outperformed with 43.3% gain despite cautious sentiment
• Singapore ETF rose 30.4% as earnings outlook modestly improves
• Malaysia shows earnings acceleration but trades at valuation discount
• Indonesia lagged -14.6% despite strong earnings growth forecast

Summary

ASEAN Inc., a basket of seven U.S.-listed ETFs covering Indonesia, Malaysia, the Philippines, Singapore, Thailand, Vietnam and the region’s top 40 firms, posted a 16.1% total return (13.1% annualized) from Dec 31 2024 to March 20 2026, outpacing the S&P 500’s 15% gain. Vietnam’s ETF led with a 43.3% jump, while Singapore, Malaysia and the regional top‑40 delivered 30.4%, 21.8% and 21.5% respectively. Despite strong earnings outlooks in several markets, valuations remain compressed, especially in Indonesia and the Philippines. The performance underscores a divergence between fundamentals and investor sentiment across Southeast Asia.

Pulse Analysis

ASEAN Inc. aggregates seven U.S.-listed exchange‑traded funds that track the equity markets of Indonesia, Malaysia, the Philippines, Singapore, Thailand, Vietnam and the region’s 40 largest companies. By consolidating these ETFs, the portfolio offers investors a single‑ticket exposure to Southeast Asia’s demographic dividend, rising middle‑class consumption and increasing integration into global supply chains. From the end of 2024 through March 2026 the basket generated a 16.1% total return, translating to a 13.1% annualized gain, comfortably beating the S&P 500’s 15% performance despite the ongoing Iran conflict and tighter global monetary conditions.

Country‑level results reveal a striking split between earnings momentum and market sentiment. Vietnam’s Global X MSCI Vietnam ETF surged 43.3%, yet investors remain cautious as earnings growth slows to 14% annually and price‑to‑earnings contracts to 13.7×. Singapore’s iShares MSCI Singapore ETF posted a 30.4% rise, supported by a modest earnings uptick and a higher valuation multiple of 15.6×. Conversely, Indonesia lagged –14.6% despite a projected 14% earnings growth, indicating that macro‑economic and currency risks are still discounting fundamentals. Malaysia and Thailand show improving earnings but trade below historical multiples, suggesting mispricing opportunities.

For portfolio managers, the divergence between robust earnings forecasts and subdued valuations across several ASEAN markets creates a fertile ground for alpha generation. Investors seeking diversification away from U.S. equity cycles can leverage the ASEAN Inc. structure to capture regional growth while mitigating country‑specific volatility. However, the outlook remains sensitive to external factors such as global interest‑rate trends, geopolitical tensions and commodity price swings that disproportionately affect emerging markets. A disciplined, long‑term approach that targets undervalued securities with strong cash‑flow generation is likely to outperform as the region’s structural growth narrative unfolds.