Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Cross Asset Strategy

In this report, we screen for stocks that are largely avoided by global emerging market active funds. We identify companies within the MSCI Emerging Markets Index that are held underweight by EM active funds and by less than 3% of the active fund population.To test whether avoiding these stocks has been a good strategy, we create an 'EM Unloved' portfolio that contains all the stocks from the screen, rebalanced monthly and back-tested over the last 7 years.The results show a significant underperformance of EM Unloved stocks against the benchmark MSCI EM Index, and avoiding these stocks has clearly played a part in the long-term outperformance of EM active funds against the benchmark.  With an average of 26% of the MSCI EM index largely avoided by active EM investors, it questions the logic of broad-based index strategies when it comes to emerging market exposure.

In this report, we screen for stocks that are largely avoided by global emerging market active funds. We identify companies within the MSCI Emerging Markets Index that are held underweight by EM active funds and by less than 3% of the active fund population.To test whether avoiding these stocks has been a good strategy, we create an 'EM Unloved' portfolio that contains all the stocks from the screen, rebalanced monthly and back-tested over the last 7 years.The results show a significant underperformance of EM Unloved stocks against the benchmark MSCI EM Index, and avoiding these stocks has clearly played a part in the long-term outperformance of EM active funds against the benchmark.  With an average of 26% of the MSCI EM index largely avoided by active EM investors, it questions the logic of broad-based index strategies when it comes to emerging market exposure.

EM Managers: Most Avoided Stocks - 2018 Update

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Thematic (Sector/Industry)

<ul><li>We highlight 25 Korean companies that are seeking to find new owners through M&amp;A in 2018. Key sectors of M&amp;A in Korea in 2018 include consumer, financials, and industrial. Our analysis is based on the publicly available information. Of the 25 companies, 10 are publicly listed companies and the remaining companies are private companies or business units of public companies. </li><li>The top five Korean companies up for sale in 2018 (in terms of size) include ADT Caps, Daewoo E&amp;C, Coway, Dongsuh F&amp;B, and CJ Healthcare. </li><li>In 2018, there could be a greater interest from the Chinese companies in the Korean M&amp;A market, which could help to accelerate some of the M&amp;A activities of the companies listed below. In 2017, many Chinese companies avoided acquiring Korean companies due to the political pressure from the Chinese government arising from the THAAD conflict</li></ul>

We highlight 25 Korean companies that are seeking to find new owners through M&amp;A in 2018. Key sectors of M&amp;A in Korea in 2018 include consumer, financials, and industrial. Our analysis is based on the publicly available information. Of the 25 companies, 10 are publicly listed companies and the remaining companies are private companies or business units of public companies. The top five Korean companies up for sale in 2018 (in terms of size) include ADT Caps, Daewoo E&amp;C, Coway, Dongsuh F&amp;B, and CJ Healthcare. In 2018, there could be a greater interest from the Chinese companies in the Korean M&amp;A market, which could help to accelerate some of the M&amp;A activities of the companies listed below. In 2017, many Chinese companies avoided acquiring Korean companies due to the political pressure from the Chinese government arising from the THAAD conflict

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

MSCI Emerging Markets Index / Technical Analysis

Asia is leading EM higher.  In this week's Chart Book, we highlight the following themes and actionable charts: <ul><li>Overweight Asia. In today’s report we highlight a broad array of actionable names within the Asia region ... see pages 3-6</li><li>Indian banks are breaking out. India’s state banks broke out last week in response to the government’s announcement of a $32.5 billion recapitalization plan. Actionable ideas: Punjab National Bank (532461-IN), State Bank of India (500112-IN), ICICI Bank (532174-IN)... see page 2</li><li>Leading Sectors. EM sectors exhibiting attractive relative strength trends include: consumer discretionary, energy, financials, health care, materials, and tech. This (mostly) cyclical line-up supports a risk-on outlook. When defensive sectors exhibit improving relative strength, then we’ll turn cautious on EM’s advance.</li></ul>

Asia is leading EM higher.  In this week's Chart Book, we highlight the following themes and actionable charts: Overweight Asia. In today’s report we highlight a broad array of actionable names within the Asia region ... see pages 3-6Indian banks are breaking out. India’s state banks broke out last week in response to the government’s announcement of a $32.5 billion recapitalization plan. Actionable ideas: Punjab National Bank (532461-IN), State Bank of India (500112-IN), ICICI Bank (532174-IN)... see page 2Leading Sectors. EM sectors exhibiting attractive relative strength trends include: consumer discretionary, energy, financials, health care, materials, and tech. This (mostly) cyclical line-up supports a risk-on outlook. When defensive sectors exhibit improving relative strength, then we’ll turn cautious on EM’s advance.

EM Technicals: Overweight Asia; Indian Banks Are Breaking Out; Bottom-Up Ideas

Korea Stock Exchange Kospi Index / Technical Analysis

Korea Stock Exchange Kospi Index (KOSPI INDEX)

The two-month pullback in Korea KOSPI has created buying opportunities. In fact, this recent weakness is largely confined to auto and financial stocks, masking strength in other segments, such as tech and materials, where bullish inflections are visible.  In this report we highlight a variety of actionable investment themes.

The two-month pullback in Korea KOSPI has created buying opportunities. In fact, this recent weakness is largely confined to auto and financial stocks, masking strength in other segments, such as tech and materials, where bullish inflections are visible.  In this report we highlight a variety of actionable investment themes.

Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

<h2>A hidden gem in OLED sphere</h2><a href="https://www.smartkarma.com/profiles/1446" target="_blank" data-smartkarma-citation="accounts:1446">JL Warren Capital</a> gives us an interesting OLED stock to watch in the long-term. This company is called <a href="https://www.smartkarma.com/entities/14297" target="_blank" data-smartkarma-citation="entities:14297:1">Nissha Printing Co Ltd (7915 JP)</a>, which is the newly selected 3D touch sensor sole supplier for the upcoming iPhone 8 OLED model. JL Warren believes the barrier to entry in 3D touch sensor isn't being appreciated properly by the capital markets. Furthermore, there is a buying opportunity from a valuation perspective. The current valuation of Nissha stock of only 7x…

A hidden gem in OLED sphereJL Warren Capital gives us an interesting OLED stock to watch in the long-term. This company is called Nissha Printing Co Ltd (7915 JP), which is the newly selected 3D touch sensor sole supplier for the upcoming iPhone 8 OLED model. JL Warren believes the barrier to entry in 3D touch sensor isn't being appreciated properly by the capital markets. Furthermore, there is a buying opportunity from a valuation perspective. The current valuation of Nissha stock of only 7x…

The Week That Was in NorthAsia@Smartkarma: Lineage, Moonjaeinnomics, Toshiba and 3D Touch Sensor

South Korea

Samsung SDS Co., Ltd. provides information technology services, such as consulting and technical services. The Company also offers outsourcing services including application outsourcing, IT infrastructure outsourcing, and cloud computing.

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Samsung SDS (018260 KS)

EM Managers: Most Avoided Stocks - 2018 Update

In this report, we screen for stocks that are largely avoided by global emerging market active funds. We identify companies within the MSCI...

Steven Holden

2018 Korea M&A Preview: What's For Sale?

We highlight 25 Korean companies that are seeking to find new owners through M&A in 2018. Key sectors of M&A in Korea in 2018...

Douglas Kim

EM Technicals: Overweight Asia; Indian Banks Are Breaking Out; Bottom-Up Ideas

Asia is leading EM higher. In this week's Chart Book, we highlight the following themes and actionable charts: Overweight Asia. In today’s...

Vermilion Research

Pullback Opportunity in South Korea

The two-month pullback in Korea KOSPI has created buying opportunities. In fact, this recent weakness is largely confined to auto and financial...

Vermilion Research

The Week That Was in NorthAsia@Smartkarma: Lineage, Moonjaeinnomics, Toshiba and 3D Touch Sensor

A hidden gem in OLED sphereJL Warren Capital gives us an interesting OLED stock to watch in the long-term. This company is called Nissha Printing...

Sanghyun Park

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