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

Nomura Research Institute / Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nomura-research-institute-ltd" target="_blank" data-smartkarma-citation="entities:18129:1" rel="noopener">Nomura Research Institute (4307 JP)</a> and <a href="https://www.smartkarma.com/entities/ryohin-keikaku-co-ltd" target="_blank" data-smartkarma-citation="entities:2765:1" rel="noopener">Ryohin Keikaku (7453 JP)</a> will replace <a href="https://www.smartkarma.com/entities/nippon-paper-industries-co-l" target="_blank" data-smartkarma-citation="entities:557:1" rel="noopener">Nippon Paper Industries Co L (3863 JP)</a> and <a href="https://www.smartkarma.com/entities/dic-corp" target="_blank" data-smartkarma-citation="entities:7343:1" rel="noopener">Dic Corp (4631 JP)</a> in 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>. </li>
<li>
<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>'s CPAF will drop from 3 to 2.7 and there will be further selling in March 2025 as the CPAF drops to 2.4 (or possibly even 2.1!) </li>
<li>Passives will need to buy 7-15x ADV (13-14% of real float) in the adds and sell 2.7-6.5x ADV in the deletes. There is a big reverse funding trade too.</li>
</ul>



Nomura Research Institute (4307 JP) and Ryohin Keikaku (7453 JP) will replace Nippon Paper Industries Co L (3863 JP) and Dic Corp (4631 JP) in the Nikkei 225 (NKY INDEX). 

Fast Retailing (9983 JP)'s CPAF will drop from 3 to 2.7 and there will be further selling in March 2025 as the CPAF drops to 2.4 (or possibly even 2.1!) 
Passives will need to buy 7-15x ADV (13-14% of real float) in the adds and sell 2.7-6.5x ADV in the deletes. There is a big reverse funding trade too.


Nikkei 225 Index Rebalance: NRI, Ryohin Keikaku IN; Nippon Paper, DIC OUT; Fast Retailing Capped

Japanese Equity Specialist, Ortus Advisors

Andrew Jackson

Japanese Equity Specialist

Ortus Advisors

Thematic (Sector/Industry)

<ul>
<li>Masayoshi Son is floating a $1trn AI factory in Arizona in exchange for tax breaks.</li>
<li>NTT Data out, Rohm in. Downside for Ibiden, but also small buying for Fasty, Terumo, Konami and others.</li>
<li>Renesas announces details of its Wolfspeed restructuring deal which includes kitchen sinking the losses this year.</li>
</ul>


Masayoshi Son is floating a $1trn AI factory in Arizona in exchange for tax breaks.
NTT Data out, Rohm in. Downside for Ibiden, but also small buying for Fasty, Terumo, Konami and others.
Renesas announces details of its Wolfspeed restructuring deal which includes kitchen sinking the losses this year.


Japan Morning Connection: US Directly Attacks Iran and Requests Japan to Spend 5% of GDP on Defense

<ul>
<li>Big gains in the US semi and DC related should translate into continued upside in Japan despite some BIG gains yesterday.</li>
<li>Wire and cable plays are all surging, yet the smaller side of the sector underperforms. Nidec good risk/reward into numbers.</li>
<li>HAMR rollout helping Seagate higher should also help memory/HDD component plays.</li>
</ul>


Big gains in the US semi and DC related should translate into continued upside in Japan despite some BIG gains yesterday.
Wire and cable plays are all surging, yet the smaller side of the sector underperforms. Nidec good risk/reward into numbers.
HAMR rollout helping Seagate higher should also help memory/HDD component plays.


Japan Morning Connection: AI Binge Buying Should Continue in Japan

<ul>
<li>Watch for a 'megaquake' reversal after a big rotation for names deemed to be winners/losers on Friday on heightened expectations for a major Nankai Trough earthquake over the w/e</li>
<li>Retail related should rebound sharply after a solid 1Q showing from 3099 <a href="https://www.smartkarma.com/entities/isetan-mitsukoshi-holdings-ltd" target="_blank" data-smartkarma-citation="entities:18871:1" rel="noopener">Isetan Mitsukoshi</a>, with several related names yet to rebound on concerns the stronger yen will curb tourist spending.</li>
<li>1911 <a href="https://www.smartkarma.com/entities/sumitomo-forestry-co-ltd" target="_blank" data-smartkarma-citation="entities:9769:1" rel="noopener">Sumitomo Forestry</a> business briefing Friday confirms the strength of its US housing business, with it likely to easily exceed its latest MTP.</li>
</ul>


Watch for a 'megaquake' reversal after a big rotation for names deemed to be winners/losers on Friday on heightened expectations for a major Nankai Trough earthquake over the w/e
Retail related should rebound sharply after a solid 1Q showing from 3099 Isetan Mitsukoshi, with several related names yet to rebound on concerns the stronger yen will curb tourist spending.
1911 Sumitomo Forestry business briefing Friday confirms the strength of its US housing business, with it likely to easily exceed its latest MTP.


Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

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

iShares MSCI Emerging Markets / Technical Analysis

<p>Top-down and bottom-up technicals continue to articulate a bullish global outlook.  However a big rotation is underway.  The "anti-reflation" call is a narrative in critical condition.  We are seeing a shift into emerging markets and the global materials sector, one with long-term implications.  Intermarket analysis give this outlook the thumbs up; see attachment for complete analysis.</p>

Top-down and bottom-up technicals continue to articulate a bullish global outlook.  However a big rotation is underway.  The "anti-reflation" call is a narrative in critical condition.  We are seeing a shift into emerging markets and the global materials sector, one with long-term implications.  Intermarket analysis give this outlook the thumbs up; see attachment for complete analysis.

Japan

COMSYS Holdings Corporation is a holding company established through the merger of Nippon Comsys, Sanwa Elec, and Higashi Nihon System.  The Company, through its subsidiaries, designs, constructs, and maintains telecommunication and electrical facilities.  Comsys Holdings also manages subsidiaries that operate information processing businesses.

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Comsys Holdings (1721 JP)

Nikkei 225 Index Rebalance: NRI, Ryohin Keikaku IN; Nippon Paper, DIC OUT; Fast Retailing Capped

Nomura Research Institute and Ryohin Keikaku replace Nippon Paper and DIC in the Nikkei 225. Fast Retailing will be capped (and probably again in...

Brian Freitas

Japan Morning Connection: US Directly Attacks Iran and Requests Japan to Spend 5% of GDP on Defense

Defense related should be supported by reports on GDP defense spending along with Trump's move to directly bomb Iranian nuclear sites. Masayoshi...

Andrew Jackson

Japan Morning Connection: AI Binge Buying Should Continue in Japan

US gains in semiconductor and DC related should drive continued upside in Japan. Surges in wire and cable plays. HAMR rollout should boost memory...

Andrew Jackson

Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

Andrew Jackson

International Compass

Top-down and bottom-up technicals continue to articulate a bullish global outlook. However a big rotation is underway. The "anti-reflation" call...

Vermilion Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Nikkei 225 Index Rebalance: NRI, Ryohin Keikaku IN; Nippon Paper, DIC OUT; Fast Retailing Capped

Nomura Research Institute and Ryohin Keikaku replace Nippon Paper and DIC in the Nikkei 225. Fast Retailing will be capped (and probably again in...

Brian Freitas

Japan Morning Connection: US Directly Attacks Iran and Requests Japan to Spend 5% of GDP on Defense

Defense related should be supported by reports on GDP defense spending along with Trump's move to directly bomb Iranian nuclear sites. Masayoshi...

Andrew Jackson

Japan Morning Connection: AI Binge Buying Should Continue in Japan

US gains in semiconductor and DC related should drive continued upside in Japan. Surges in wire and cable plays. HAMR rollout should boost memory...

Andrew Jackson

Japan Morning Connection: 3099 JP, 1911 JP, 5803 JP

​Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...

Andrew Jackson

International Compass

Top-down and bottom-up technicals continue to articulate a bullish global outlook. However a big rotation is underway. The "anti-reflation" call...

Vermilion Research

Expect a 'megaquake' reversal in stock names post-rotation due to earthquake warnings, retail rebound likely after strong 3099 1Q showing,...