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 FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.</li>
<li>The changes for the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300</a>, <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI 500</a>, <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50</a>, <a href="https://www.smartkarma.com/entities/shanghai-stock-exchange-sse-50-a-share-index" target="_blank" data-smartkarma-citation="entities:31073:1" rel="noopener">SSE50</a> and a bunch of other mainland China indices will be announced after market close on Friday.</li>
<li>Relatively quiet week for ETF flows with no major creations or redemptions during the week.</li>
</ul>


The FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.
The changes for the CSI 300, CSI 500, STAR50, SSE50 and a bunch of other mainland China indices will be announced after market close on Friday.
Relatively quiet week for ETF flows with no major creations or redemptions during the week.


Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

Technology / Semiconductor / Internet Research

Nicolas Baratte

Equity Bottom-Up

<ul>
<li>Nvidia H20 sales to China were barred last month. Nvidia first mentioned designing a new China-specific chip. Maybe not: it looks very difficult to work around the updated US limits</li>
<li>Semiconductor design software was barred last week. Synopsys suspended its guidance. My industry checks suggests that the ban applies to Xiaomi (ie the new smartphone chip) and to Lenovo. </li>
<li>Hanmi Semi stopped shipping TC Bonder to Chinese clients. This is critical to make HBM memory that goes into AI processors.</li>
</ul>


Nvidia H20 sales to China were barred last month. Nvidia first mentioned designing a new China-specific chip. Maybe not: it looks very difficult to work around the updated US limits
Semiconductor design software was barred last week. Synopsys suspended its guidance. My industry checks suggests that the ban applies to Xiaomi (ie the new smartphone chip) and to Lenovo. 
Hanmi Semi stopped shipping TC Bonder to Chinese clients. This is critical to make HBM memory that goes into AI processors.


US – China: Restrictions on Semiconductors Are Getting Worse

<ul>
<li>China represents ~11% of revenues for Cadence and Synopsys. The weight of China has been declining. </li>
<li>China has a number of startup working on replacement software, the leader is Empyrean – good but some years behind Cadence and Synopsys and focused on legacy chip design. </li>
<li>Between this news today and more restrictions on Nvidia’s sales to China, it looks like more US restrictions will come.</li>
</ul>


China represents ~11% of revenues for Cadence and Synopsys. The weight of China has been declining. 
China has a number of startup working on replacement software, the leader is Empyrean – good but some years behind Cadence and Synopsys and focused on legacy chip design. 
Between this news today and more restrictions on Nvidia’s sales to China, it looks like more US restrictions will come.


President Trump “orders US Chip Software Suppliers to Stop Selling to China”

Shandong Himile Mechanical Science & Technology / Index Rebalance

Shandong Himile Mechanical Science & Technology

<ul>
<li>There could be 18 changes for the CSI A500 Index at the June rebalance. Turnover is estimated at 1.7% and the round-trip trade is around US$1bn.</li>
<li>The index was launched in September 2024, and the passive trackers have taken in a chunk of money since then. The flows to the stocks add to other index flows.</li>
<li>A long add/short deletes trade has been stable over the last few months. The forecast adds could outperform following announcement of the index changes on Friday.</li>
</ul>


There could be 18 changes for the CSI A500 Index at the June rebalance. Turnover is estimated at 1.7% and the round-trip trade is around US$1bn.
The index was launched in September 2024, and the passive trackers have taken in a chunk of money since then. The flows to the stocks add to other index flows.
A long add/short deletes trade has been stable over the last few months. The forecast adds could outperform following announcement of the index changes on Friday.


CSI A500 Index Rebalance Preview: Many Changes Expected; US$1bn Trade

Tracking developments across tech supply chains, Tech Supply Chain Tracker

Tech Supply Chain Tracker

Tracking developments across tech supply chains

<ul><li>Taiwan server revenue and shipment forecast for 2025 is expected to increase, reflecting growth in the IT industry. </li><li>Japanese government plans to invest $1 billion in Space Strategy Fund projects, highlighting a push for innovation and exploration in the aerospace sector. </li><li>SoftBank's $6.5B Ampere acquisition is a strategic move in the AI chip market with Arm, positioning the company for future technological advancements.</li></ul>

Taiwan server revenue and shipment forecast for 2025 is expected to increase, reflecting growth in the IT industry. Japanese government plans to invest $1 billion in Space Strategy Fund projects, highlighting a push for innovation and exploration in the aerospace sector. SoftBank's $6.5B Ampere acquisition is a strategic move in the AI chip market with Arm, positioning the company for future technological advancements.

Tech Supply Chain Tracker (21-Mar-2025): Taiwan server revenue forecast 2025.

China

Empyrean Technology Co., Ltd. operates as an EDA developer and solutions provider. The Company develops analog circuit design electronic design automation (EDA) tool systems, digital circuit design electronic design automation tools, flat panel display circuit design electronic design automation tools, and others. Empyrean Technology conducts businesses in China.

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Empyrean Technology (301269 CH)

Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

US – China: Restrictions on Semiconductors Are Getting Worse

Nvidia might not have a workaround for a new China-specific chip. EDA software ban also for consumer electronics Xiaomi, Lenovo. Hanmi Semi halted...

Nicolas Baratte

President Trump “orders US Chip Software Suppliers to Stop Selling to China”

US could restrict US chip design software vendors to sell to China. China represents 11% of Cadence and Synopsys revenues. Leading Chinese...

Nicolas Baratte

CSI A500 Index Rebalance Preview: Many Changes Expected; US$1bn Trade

We identify 18 potential changes for the CSI A500 Index. The index was launched in Sep 24 and has taken in a lot of AUM very quickly. The flows to...

Brian Freitas

Tech Supply Chain Tracker (21-Mar-2025): Taiwan server revenue forecast 2025.

Taiwan server revenue forecast, Japan's $1B Space Strategy Fund, SoftBank's Ampere acquisition, China's Empyrean Technology acquires Xpeedic,...

Tech Supply Chain Tracker

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

US – China: Restrictions on Semiconductors Are Getting Worse

​Nvidia might not have a workaround for a new China-specific chip. EDA software ban also for consumer electronics Xiaomi, Lenovo. Hanmi Semi halted...

Nicolas Baratte

President Trump “orders US Chip Software Suppliers to Stop Selling to China”

US could restrict US chip design software vendors to sell to China. ​China represents 11% of Cadence and Synopsys revenues. Leading Chinese...

Nicolas Baratte

CSI A500 Index Rebalance Preview: Many Changes Expected; US$1bn Trade

We identify 18 potential changes for the CSI A500 Index. The index was launched in Sep 24 and has taken in a lot of AUM very quickly. The flows to...

Brian Freitas

Tech Supply Chain Tracker (21-Mar-2025): Taiwan server revenue forecast 2025.

Taiwan server revenue forecast, Japan's $1B Space Strategy Fund, SoftBank's Ampere acquisition, China's Empyrean Technology acquires Xpeedic,...

Tech Supply Chain Tracker

Nvidia might not have a workaround for a new China-specific chip. EDA software ban also for consumer electronics Xiaomi, Lenovo. Hanmi Semi halted...

US could restrict US chip design software vendors to sell to China. China represents 11% of Cadence and Synopsys revenues. Leading Chinese...