Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Mizuho was out overnight with bullish commentary on the segment and it raised both Advantest Corp  and Shin Etsu Chemical to buy, so this may help mellow the negative sentiment.</li>
<li>Japan AI related had a big fall yesterday but may stabilise soon with many stocks back down around their 200-day levels with intact growth outlooks and earnings done.</li>
<li>Sumi Forestry could see a squeeze after US homebuilders KB Home, DR Horton and Lennar rallied on the Treasury's bond-buying intervention.</li>
</ul>


Mizuho was out overnight with bullish commentary on the segment and it raised both Advantest Corp  and Shin Etsu Chemical to buy, so this may help mellow the negative sentiment.
Japan AI related had a big fall yesterday but may stabilise soon with many stocks back down around their 200-day levels with intact growth outlooks and earnings done.
Sumi Forestry could see a squeeze after US homebuilders KB Home, DR Horton and Lennar rallied on the Treasury's bond-buying intervention.


Japan Morning Connection: Advantest, Shin Etsu Upgraded to Buy Amid Negative AI Sentiment

CEO / Founder, Crea8

Kim-Hwa Lim

CEO / Founder

Make an Impact

Crea8

Crea8 blends AI-driven precision, big data scalability, and rigorous quantitative frameworks with seasoned human insight. By extracting actionable intelligence from vast global datasets, we eliminate emotional bias and deliver optimal risk-adjusted returns. Our hybrid approach uncovers hidden market efficiencies and ensures your capital is dynamically positioned across markets.

Cross Asset Strategy

<ul><li>The strategy seeks to invest in global companies with sustainable competitive advantages.</li><li>By adopting a portfolio of stocks instead of individual stocks, the strategy is diversified across countries and industries; and optimised with respect to their expected risks and returns.</li><li>Previous portfolio returned 7.1% vs. MSCI World (4.2%) – outperformed the benchmark by 2.9%.</li></ul>

The strategy seeks to invest in global companies with sustainable competitive advantages.By adopting a portfolio of stocks instead of individual stocks, the strategy is diversified across countries and industries; and optimised with respect to their expected risks and returns.Previous portfolio returned 7.1% vs. MSCI World (4.2%) – outperformed the benchmark by 2.9%.

Global Competitive Barrier Portfolio (18 Aug 2026)

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Index Rebalance

<ul>
<li>The review period for the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> March rebalance ends in 4 weeks. Depending on the index committee discretion, there could be 1-3 changes at the rebalance.</li>
<li>
<a href="https://www.smartkarma.com/entities/advantest-corp" target="_blank" data-smartkarma-citation="entities:18107:1" rel="noopener">Advantest Corp (6857 JP)</a>'s index weight is currently above 10% and that will result in capping. <a href="https://www.smartkarma.com/entities/fast-retailing-co-ltd" target="_blank" data-smartkarma-citation="entities:751:1" rel="noopener">Fast Retailing (9983 JP)</a> and <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a> avoid capping for now.</li>
<li>The capping for <a href="https://www.smartkarma.com/entities/advantest-corp" target="_blank" data-smartkarma-citation="entities:18107:1" rel="noopener">Advantest Corp (6857 JP)</a> results in funding inflows for all the index constituents, though the impact tops out at 0.4x ADV.</li>
</ul>


The review period for the Nikkei 225 (NKY INDEX) March rebalance ends in 4 weeks. Depending on the index committee discretion, there could be 1-3 changes at the rebalance.

Advantest Corp (6857 JP)'s index weight is currently above 10% and that will result in capping. Fast Retailing (9983 JP) and Softbank Group (9984 JP) avoid capping for now.
The capping for Advantest Corp (6857 JP) results in funding inflows for all the index constituents, though the impact tops out at 0.4x ADV.


Nikkei 225 Index Rebalance Preview (Mar 2026): Potential Adds, Deletes, Capping & Other Changes

Equity/Index & Cross Asset Volatility Specialist, Cameron Design

Jay Cameron

Equity/Index & Cross Asset Volatility Specialist

Cameron Design

We specialize in financial products and volatility. Our strategies balance speed, data, and risk control to capture opportunities across global markets. Our research leverages AI and data analytics to continuously refine our algorithms and adapt to evolving market dynamics.

Equity Derivatives

<ul>
<li>Advantest's updated guidance and MTP3 targets confirm its dominant, long-term growth trajectory as a key supplier for the high-performance computing and AI semiconductor supply chain.</li>
<li>Despite a strong structural growth story, the stock faces near-term headwinds from a sequential decline in Q2 operating income and an elevated valuation that reflects peak market optimism.</li>
<li>We suggest a tactical adjustment to vega exposure due to market dynamics, recommending a strategy to monetize the heightened implied and realized volatility following the strong earnings report.</li>
</ul>


Advantest's updated guidance and MTP3 targets confirm its dominant, long-term growth trajectory as a key supplier for the high-performance computing and AI semiconductor supply chain.
Despite a strong structural growth story, the stock faces near-term headwinds from a sequential decline in Q2 operating income and an elevated valuation that reflects peak market optimism.
We suggest a tactical adjustment to vega exposure due to market dynamics, recommending a strategy to monetize the heightened implied and realized volatility following the strong earnings report.


Advantest Q2 FY2025, Navigating Post-Earnings Volatility

Japanese Turnaround Situations, Short-Ideas, Azabu Research

Michael Allen

Japanese Turnaround Situations, Short-Ideas

Azabu Research

Azabu Research is a publishing and consulting firm focused on distressed equities in the Japanese market. We specialize in turnaround strategies, corporate combinations, divestitures, and restructuring.

Publisher of the Tokyo Turnaround Letter, which conducts the most thorough research possible of publicly available information, including forensic tests for fraudulent overstatement of assets and understatement of liabilities, as well as rigorous market and industry analysis to assess the underlying strengths of the company’s products or services, the appropriateness of the company’s turnaround strategy, and the skill of its current management team. The average length of a report exceeds 25 pages of text and tables, excluding any disclosures or executive summaries.

We have more than 30 years of experience in applying this process to distressed equities in Japan. Additionally, subscribers have free access to detailed, yet easily navigated earnings models for the target company as well as the top five comparable companies, and unlimited access to the analyst for follow-up questions.

Azabu Research also conducts be-spoke research on a project basis, and provides consulting services to companies looking to restructure, divest, make acquisitions, go public, or improve investor sentiment toward their stock.

Independent Research and Consulting Firm

Equity Bottom-Up

<ul>
<li>Nearly every comment on Japanese equities is focused on the half of the market that trades below book, but last week, Advantest, which trades at 18x book, exploded 30%.</li>
<li>Searches for “AI Bubble” on google are up 90%, but Advantest’s share price exploded because it became clear that investors were underestimating demand for AI related hardware.</li>
<li>Fear and Hype on both sides proved overdone. When I searched for the truth, I found only 1 red flag, 2 green, and 7 yellow.  </li>
</ul>


Nearly every comment on Japanese equities is focused on the half of the market that trades below book, but last week, Advantest, which trades at 18x book, exploded 30%.
Searches for “AI Bubble” on google are up 90%, but Advantest’s share price exploded because it became clear that investors were underestimating demand for AI related hardware.
Fear and Hype on both sides proved overdone. When I searched for the truth, I found only 1 red flag, 2 green, and 7 yellow.  


Advantest (6857) Bubble Watch: 1 Red Flag, 2 Green, 7 Yellow. You Decide.

Japan

ADVANTEST CORPORATION produces semiconductor testing devices and electronic measuring instruments.  The Company's products include large-scale integration (LSI) test systems, memory test systems, dynamic test handlers, network analyzers, electronic meters, optical testing devices, and signal sources.

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Advantest Corp (6857 JP)

Japan Morning Connection: Advantest, Shin Etsu Upgraded to Buy Amid Negative AI Sentiment

Japan AI related had a big fall yesterday but may stabilise soon with many stocks back down around their 200-day levels with intact growth outlooks...

Andrew Jackson

Global Competitive Barrier Portfolio (18 Aug 2026)

The strategy seeks to invest in global companies with sustainable competitive advantages. By adopting a portfolio of stocks instead of individual...

Crea8

Nikkei 225 Index Rebalance Preview (Mar 2026): Potential Adds, Deletes, Capping & Other Changes

There could 1-3 changes for the NKY in March. Advantest will be capped in March and could be capped in September too. Passives need to trade...

Brian Freitas

Advantest Q2 FY2025, Navigating Post-Earnings Volatility

Advantest's growth trajectory faces near-term challenges from declining Q2 operating income and high valuation, suggesting a tactical adjustment...

Jay Cameron

Advantest (6857) Bubble Watch: 1 Red Flag, 2 Green, 7 Yellow. You Decide.

Half of Japan’s stocks trade below book value, while google searches for “AI bubble” have increased 90%, so Advantest, trading at 18x book just...

Michael Allen

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Japan Morning Connection: Advantest, Shin Etsu Upgraded to Buy Amid Negative AI Sentiment

Japan AI related had a big fall yesterday but may stabilise soon with many stocks back down around their 200-day levels with intact growth outlooks...

Andrew Jackson

Global Competitive Barrier Portfolio (18 Aug 2026)

The strategy seeks to invest in global companies with sustainable competitive advantages. By adopting a portfolio of stocks instead of individual...

Crea8

Nikkei 225 Index Rebalance Preview (Mar 2026): Potential Adds, Deletes, Capping & Other Changes

There could 1-3 changes for the NKY in March. Advantest will be capped in March and could be capped in September too. Passives need to trade...

Brian Freitas

Advantest Q2 FY2025, Navigating Post-Earnings Volatility

​Advantest's growth trajectory faces near-term challenges from declining Q2 operating income and high valuation, suggesting a tactical adjustment...

Jay Cameron

Advantest (6857) Bubble Watch: 1 Red Flag, 2 Green, 7 Yellow. You Decide.

Half of Japan’s stocks trade below book value, while google searches for “AI bubble” have increased 90%, so Advantest, trading at 18x book just...

Michael Allen

Advantest's growth trajectory faces near-term challenges from declining Q2 operating income and high valuation, suggesting a tactical adjustment...