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 September rebalance ends on 31 July, the changes will be announced towards end August and implemented at the close of trading on 7 September.</li>
<li>There are potential changes to some of the indices and then there are close changes that will result in big flows if they eventuate.</li>
<li>The March rebalance saw some funky moves on the stocks that had big flows and we could see more of that at the September rebalance.</li>
</ul>


The review period for the September rebalance ends on 31 July, the changes will be announced towards end August and implemented at the close of trading on 7 September.
There are potential changes to some of the indices and then there are close changes that will result in big flows if they eventuate.
The March rebalance saw some funky moves on the stocks that had big flows and we could see more of that at the September rebalance.


KRX New Deal Index Rebalance Preview: Potential & Close Changes in September

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>Currently, the market cap of Ecopro BM surpassed Posco Future M. As a result, Ecopro BM is in a position to replace Posco Future M in the K-New Deal rebalancing.</li>
<li>They are direct peers with a high price cointegration. We should consider using the rebalancing event of this index as an inflection point from a Long Short pair trading perspective.</li>
<li>The likelihood of Ecopro BM being included in the Solactive Lithium Index in October could potentially increase the expected return of taking this Long Short position more preemptively.</li>
</ul>


Currently, the market cap of Ecopro BM surpassed Posco Future M. As a result, Ecopro BM is in a position to replace Posco Future M in the K-New Deal rebalancing.
They are direct peers with a high price cointegration. We should consider using the rebalancing event of this index as an inflection point from a Long Short pair trading perspective.
The likelihood of Ecopro BM being included in the Solactive Lithium Index in October could potentially increase the expected return of taking this Long Short position more preemptively.


A Noteworthy Long Short Setup: Ecopro BM & Posco Future M

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<ul>
<li>On 20 April, Chile's government announced that it will be nationalizing the country's lithium industry. Chile is the second largest producer of lithium in the world. </li>
<li>The nationalization of the lithium industry in Chile will likely have a long-term negative impact on the rechargeable batteries related companies in Korea.</li>
<li>This is mainly due to greater challenges of getting access to lithium at more affordable prices. </li>
</ul>


On 20 April, Chile's government announced that it will be nationalizing the country's lithium industry. Chile is the second largest producer of lithium in the world. 
The nationalization of the lithium industry in Chile will likely have a long-term negative impact on the rechargeable batteries related companies in Korea.
This is mainly due to greater challenges of getting access to lithium at more affordable prices. 


Nationalization of Lithium Industry in Chile - Impact on Korean Rechargeable Batteries Value Chain

<ul>
<li>In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 2Q 2023.</li>
<li>Of the 38 pair trades, 21 of them involved holdcos outperforming opcos YTD and 17 of them involved opcos outperforming holdcos in the same period.</li>
<li>We highlight 38 pair trades that involve Korean holdcos and opcos.</li>
</ul>


In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 2Q 2023.
Of the 38 pair trades, 21 of them involved holdcos outperforming opcos YTD and 17 of them involved opcos outperforming holdcos in the same period.
We highlight 38 pair trades that involve Korean holdcos and opcos.


Korean Holdcos Vs Opcos Gap Trading Opportunities in 2Q 2023

<ul>
<li>According to Hankyung Business Daily, Ecopro BM Co Ltd (247540 KS) is considering on issuing a CB worth 500 billion won to various private equity and asset managment companies.</li>
<li>We would be negative on the potential CB issuance of nearly 500 billion won by Ecopro BM.</li>
<li>The potential issuance of this CB is a signal from the management that it is trying to capitalize on the recent sharp increases in share price to raise more capital.</li>
</ul>


According to Hankyung Business Daily, Ecopro BM Co Ltd (247540 KS) is considering on issuing a CB worth 500 billion won to various private equity and asset managment companies.
We would be negative on the potential CB issuance of nearly 500 billion won by Ecopro BM.
The potential issuance of this CB is a signal from the management that it is trying to capitalize on the recent sharp increases in share price to raise more capital.


Ecopro BM: Considering on a CB Issuance of 500 Billion Won

South Korea

Ecopro BM Co.,Ltd develops and manufactures advanced materials. The Company produces and sells high-nickel cathode materials and other products. Ecopro BM markets its products throughout Korea.

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Ecopro BM (247540 KS)

KRX New Deal Index Rebalance Preview: Potential & Close Changes in September

There were big moves on stocks that were changes at the March rebalance. We take a look at expected and close changes at the September rebalance....

Brian Freitas

A Noteworthy Long Short Setup: Ecopro BM & Posco Future M

This post examines a long short setup involving Ecopro BM and Posco Future M aimed at the K-New Deal rebalancing in September.

Sanghyun Park

Nationalization of Lithium Industry in Chile - Impact on Korean Rechargeable Batteries Value Chain

The nationalization of the lithium industry in Chile will likely have a long-term negative impact on the rechargeable batteries related companies...

Douglas Kim

Korean Holdcos Vs Opcos Gap Trading Opportunities in 2Q 2023

In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 2Q 2023. We highlight 38 pair trades that...

Douglas Kim

Ecopro BM: Considering on a CB Issuance of 500 Billion Won

According to Hankyung Business Daily, Ecopro BM Co Ltd (247540 KS) is considering on issuing a CB worth 500 billion won to various private equity...

Douglas Kim

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