PXP Vietnam Asset Management, a US$225 million asset management shop based in Ho Chi Ming City, Vietnam, plans to start a hedge fund by early next year to invest in undervalued stocks in the country.

The PXP Vietnam Value Fund will raise as much as US$200 million, Bloomberg News reports. The fund will be firm’s first open-ended vehicle, allowing investors to withdraw their money after a one-year lock-up, with restrictions on what can be redeemed at once. It will have the “flexibility to use hedging when and where available, and if the manager feels it appropriate taking pricing and market conditions into account,'” according to CEO Kevin Snowball.

“There are some very cheap stocks here; there are also some extremely badly run companies,” said Snowball, in an interview. “We're at the beginning of the rally so that almost everything is going up; as we go higher there'll be more discrimination.'”

Snowball, formerly of ABN Amro Holding and Deutsche Morgan Grenfell, and Jonathon Waugh founded PXP in 2002. The firm currently manages three closed-end funds listed in Ireland that invest in publicly traded Vietnamese companies.