Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>For this March rebalancing, the screening base date is January 28, which is the last trading day of January. So, <strong>the 3-month rebalancing review period is now done</strong>.</li>
<li>Other than <strong>LG Energy (+₩146,2B)</strong>, we should pay the most attention to <strong>AfreecaTV (+1.70x)</strong>,<strong> Chunbo (+0.36x)</strong>,<strong> Douzone Bizon (-4.82x)</strong>, and <strong>SoulBrain (-0.99x</strong>).</li>
<li>In addition, large-cap stocks such as <strong>SKIET (+0.25x)</strong>,<strong> Ecopro BM (+0.10x)</strong>,<strong> LG Chem (-0.62x)</strong>, and <strong>Posco Chemical (-0.30x)</strong> will likely draw much attention.</li>
</ul>


For this March rebalancing, the screening base date is January 28, which is the last trading day of January. So, the 3-month rebalancing review period is now done.
Other than LG Energy (+₩146,2B), we should pay the most attention to AfreecaTV (+1.70x), Chunbo (+0.36x), Douzone Bizon (-4.82x), and SoulBrain (-0.99x).
In addition, large-cap stocks such as SKIET (+0.25x), Ecopro BM (+0.10x), LG Chem (-0.62x), and Posco Chemical (-0.30x) will likely draw much attention.


KRX K-New Deal Index Screening Period Ended: Rebalancing Changes & Passive Impacts Update

<ul>
<li>
<strong>The rebalancing cycle of the KODEX Secondary Battery ETF was changed from semi-annual to quarterly.</strong> Also, the rebalancing trading takes place for three trading days instead of one trading day.</li>
<li>
<strong>This passive impact will be different from the previous rebalancing.</strong> LG Energy and SK Innovation will likely experience a significant passive outflow. Then, most small-cap constituents will receive an inflow. </li>
<li>
<strong>Among the top weighting stocks, Samsung SDI and SKIET deserve attention</strong>. Sangsin Energy, E&amp;D, and TSI will face exclusion, while C&amp;I, Sang-A Frontec, and Enchem will likely join the ETF.</li>
</ul>



The rebalancing cycle of the KODEX Secondary Battery ETF was changed from semi-annual to quarterly. Also, the rebalancing trading takes place for three trading days instead of one trading day.

This passive impact will be different from the previous rebalancing. LG Energy and SK Innovation will likely experience a significant passive outflow. Then, most small-cap constituents will receive an inflow. 

Among the top weighting stocks, Samsung SDI and SKIET deserve attention. Sangsin Energy, E&amp;D, and TSI will face exclusion, while C&amp;I, Sang-A Frontec, and Enchem will likely join the ETF.


KODEX Battery ETF Rebalancing Cycle Changed to Quarterly: Preview for March Rebalancing

<ul>
<li>The rebalancing trade of the <strong>WISE Secondary Cell ETF</strong> will take place tomorrow, <strong>January 13 (Thursday), supposedly at the close</strong>.</li>
<li>Those names with a significant passive impact among the stocks with a daily trading amount of +US$10M are: <strong>SKIET +0.71x ADTV, POSCO Chemical +0.46x ADTV, &amp; SoulBrain: -0.69x ADTV </strong>
</li>
<li>
<strong>The most likely new addition is Enchem (348370)</strong> with <strong>a passive impact of 0.60x ADTV</strong>. So, I expect a significant level of price action tomorrow.</li>
</ul>


The rebalancing trade of the WISE Secondary Cell ETF will take place tomorrow, January 13 (Thursday), supposedly at the close.
Those names with a significant passive impact among the stocks with a daily trading amount of +US$10M are: SKIET +0.71x ADTV, POSCO Chemical +0.46x ADTV, &amp; SoulBrain: -0.69x ADTV 


The most likely new addition is Enchem (348370) with a passive impact of 0.60x ADTV. So, I expect a significant level of price action tomorrow.


TIGER Secondary Cell ETF Rebalancing Trading on January 13

Index Rebalance

<ul>
<li>The rebalancing implementation of the FnGuide Secondary Battery Index will be on December 13. So, the ETF operator's rebalancing trading will take place at the close on December 10.</li>
<li>Among the stocks to which the ceiling is applied, the stocks with a relatively sizeable passive impact (at the current prices) are <strong>SK Innovation, Ecopro BM, and Posco Chemical</strong>.</li>
<li>Among the companies that have been listed since June, the companies that directly operate the rechargeable battery business are the following three: <strong>Enchem</strong>, GI Tech, and Onejoon.</li>
</ul>


The rebalancing implementation of the FnGuide Secondary Battery Index will be on December 13. So, the ETF operator's rebalancing trading will take place at the close on December 10.
Among the stocks to which the ceiling is applied, the stocks with a relatively sizeable passive impact (at the current prices) are SK Innovation, Ecopro BM, and Posco Chemical.
Among the companies that have been listed since June, the companies that directly operate the rechargeable battery business are the following three: Enchem, GI Tech, and Onejoon.


FnGuide Secondary Battery Index Rebalancing Preview in December: Watch Enchem

<p>The rebalancing trading of the TIGER WISE Secondary Cell ETF, one of the local rechargeable battery ETFs, is scheduled for <strong>October 14th</strong>.</p><p>This ETF rebalances every quarter. It has a total of 26 constituent stocks, with an AUM of ₩734.4B as of last Friday's closing price. The index weight is determined based on the float-adjusted market cap, and the cap is 10%.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Index summary"}'>Index summary</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Index name"}'>Index name</td>
<td data-sheets-value='{"1":2,"2":"Wise Secondary Cell"}'><div><div>WISE Secondary Cell</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"ETF"}'>ETF</td>
<td data-sheets-value='{"1":2,"2":"Mirae Asset TIGER Secondary Cell ETF"}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'><div><div>Mirae Asset TIGER Secondary Cell ETF</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td data-sheets-value='{"1":2,"2":"305540"}' data-sheets-formula='="305540"'>305540</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"AUM"}'><strong>AUM</strong></td>
<td data-sheets-value='{"1":3,"3":734.36175}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[1]C[0]*R[2]C[0]/1000000000"><strong>₩734.4B</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Price"}'>Price</td>
<td data-sheets-value='{"1":3,"3":22355}' data-sheets-numberformat='[null,4,"[$₩]#,##0",1]' data-sheets-formula='=googlefinance(R[-2]C[0], "price")'>₩22,355</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"SO"}'>SO</td>
<td data-sheets-value='{"1":3,"3":32850000}' data-sheets-numberformat='[null,2,"#,##0",1]'>32,850,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Number of constituents"}'>Number of constituents</td>
<td data-sheets-value='{"1":3,"3":26}' data-sheets-numberformat='{"1":2,"2":"#,##0"}'>26</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Weight type"}'><strong>Weight type</strong></td>
<td data-sheets-value='{"1":2,"2":"Float-adjusted market cap"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div><strong>Float-adjusted market cap</strong></div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Cap"}'><strong>Cap</strong></td>
<td data-sheets-value='{"1":3,"3":0.1}' data-sheets-numberformat='[null,3,"0.00%",1]'><strong>10.00%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Fast entry"}'>Fast entry</td>
<td data-sheets-value='{"1":2,"2":"Yes (a minimum holding period of 30 days)"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div>Yes (a minimum holding period of 30 days)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Rebalancing cycle"}'>Rebalancing cycle</td>
<td data-sheets-value='{"1":2,"2":"Quarterly"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'>Quarterly</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Rebalancing month"}'>Rebalancing month</td>
<td data-sheets-value='{"1":2,"2":"January, April, July, and October"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div>January, April, July, and October</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Announcement date"}'>Announcement date</td>
<td data-sheets-value='{"1":2,"2":"Only ETF operator is notified"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div>Only ETF operator is notified</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Implementation date"}'>Implementation date</td>
<td data-sheets-value='{"1":2,"2":"The trading day following the option expiration dates"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div>The trading day following the option expiration dates</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Next implementation date"}'><strong>Next implementation date</strong></td>
<td data-sheets-value='{"1":2,"2":"October 15, 2021"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div><strong>October 15, 2021</strong></div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Rebalancing trading"}'><strong>Rebalancing trading</strong></td>
<td data-sheets-value='{"1":2,"2":"At the close on October 14, 2021"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div><strong>At the close on October 14, 2021</strong></div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Screening base date"}'>Screening base date</td>
<td data-sheets-value='{"1":2,"2":"The last trading day of the month preceding the date of regular rebalancing"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div>The last trading day of the month preceding the date of regular rebalancing</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Screening period"}'>Screening period</td>
<td data-sheets-value='{"1":2,"2":"The three months preceding the screening base date"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]'><div><div>The three months preceding the screening base date</div></div></td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: KRX &amp; TIGER ETF"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula="=PDF!R[9]C[0]">Source: KRX &amp; TIGER ETF</td></tr>
</tbody>
</table><p>This index selects stocks with sales of ₩200B or more or 50% or more of total sales related to rechargeable batteries based on keyword analysis on local brokerage reports and company quarterly/annual reports published on DART.</p><p><strong>Therefore, the flexibility of changing constituent stocks is much lower than that of the Samsung KODEX Secondary Battery Industry ETF that uses the scoring system.</strong></p><p><strong>In addition, as no rechargeable battery stocks have been newly listed for the past three months, there will be no stock changes in this rebalancing. Only index weight will change. </strong></p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/230/919/original/1.png?1632173660" class="editor-image img-responsive" data-smartkarma-image-id="230919"></figure></section>

The rebalancing trading of the TIGER WISE Secondary Cell ETF, one of the local rechargeable battery ETFs, is scheduled for October 14th.This ETF rebalances every quarter. It has a total of 26 constituent stocks, with an AUM of ₩734.4B as of last Friday's closing price. The index weight is determined based on the float-adjusted market cap, and the cap is 10%.





Index summary

Index name
WISE Secondary Cell


ETF
Mirae Asset TIGER Secondary Cell ETF


Ticker
305540


AUM
₩734.4B


Price
₩22,355


SO
32,850,000


Number of constituents
26


Weight type
Float-adjusted market cap


Cap
10.00%


Fast entry
Yes (a minimum holding period of 30 days)


Rebalancing cycle
Quarterly


Rebalancing month
January, April, July, and October


Announcement date
Only ETF operator is notified


Implementation date
The trading day following the option expiration dates


Next implementation date
October 15, 2021


Rebalancing trading
At the close on October 14, 2021


Screening base date
The last trading day of the month preceding the date of regular rebalancing


Screening period
The three months preceding the screening base date

Source: KRX &amp; TIGER ETF

This index selects stocks with sales of ₩200B or more or 50% or more of total sales related to rechargeable batteries based on keyword analysis on local brokerage reports and company quarterly/annual reports published on DART.Therefore, the flexibility of changing constituent stocks is much lower than that of the Samsung KODEX Secondary Battery Industry ETF that uses the scoring system.In addition, as no rechargeable battery stocks have been newly listed for the past three months, there will be no stock changes in this rebalancing. Only index weight will change. 

TIGER WISE Secondary Cell Rebalancing Preview (October 14)

South Korea

Posco Future M Co., Ltd. manufactures and distributes energy materials. The Company produces battery materials, advanced chemical materials, basic industrial materials, and other related products. Posco Future M also produces lime chemical and refractory products.

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Posco Future M (003670 KS)

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