Asia L/S Equity PM/Macro/Thematic Idea Generation

Rikki Malik

Cross Asset Strategy

<ul>
<li>A review of recent events/data impacting our investment themes or outlook</li>
<li>Time to start unpacking your shorts for the summer season</li>
<li>Headlines should not distract from the big picture and provide  trading opportunities </li>
</ul>


A review of recent events/data impacting our investment themes or outlook
Time to start unpacking your shorts for the summer season
Headlines should not distract from the big picture and provide  trading opportunities 


Chief Economist & Political Strategist, CrossASEAN Research

Prasenjit K. Basu

Chief Economist & Political Strategist

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Macroeconomics

<ul>
<li>TSF increased by a record RMB15.18trn (US$2.09trn) in Q12025, enabling industrial growth of 6.5%YoY, FAI growth of 4.2%YoY, retail sales growth of 4.6%YoY and real GDP growth of 5.4%YoY. </li>
<li>Slumping imports and 7.5%YoY growth in exports in Q1/2025 took the 12m-rolling trade surplus to US$1.08trn in Mar'25, but FX reserves declined slightly YoY, suggesting persistence of colossal capital flight.</li>
<li>Producer prices have deflated for 5 of the past 10 years, including all 30 latest months (-2.5%YoY Mar'25). Tariff barriers will prevent exporting overcapacity, thereby exacerbating deflation, hastening financial crises. </li>
</ul>


TSF increased by a record RMB15.18trn (US$2.09trn) in Q12025, enabling industrial growth of 6.5%YoY, FAI growth of 4.2%YoY, retail sales growth of 4.6%YoY and real GDP growth of 5.4%YoY. 
Slumping imports and 7.5%YoY growth in exports in Q1/2025 took the 12m-rolling trade surplus to US$1.08trn in Mar'25, but FX reserves declined slightly YoY, suggesting persistence of colossal capital flight.
Producer prices have deflated for 5 of the past 10 years, including all 30 latest months (-2.5%YoY Mar'25). Tariff barriers will prevent exporting overcapacity, thereby exacerbating deflation, hastening financial crises. 


China: Tariff Walls to Exacerbate Capital Flight, Deflation, Over-Capacity Challenges

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>
<a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener">Xiaomi's (1810 HK)</a> one-month implied volatility has decreased from recent peaks but remains above the 90th percentile, while realized volatility is exceptionally high, exceeding 100% (100th percentile).</li>
<li>The options market exhibits an inverted term structure (backwardation) favoring calendar or diagonal spreads, with a slightly negatively sloped skew supporting put and call spreads.</li>
<li>Open interest extends to March 2026, with balanced call and put interest across most expiries, except for March 2026, which is heavily call-dominated.</li>
</ul>



Xiaomi's (1810 HK) one-month implied volatility has decreased from recent peaks but remains above the 90th percentile, while realized volatility is exceptionally high, exceeding 100% (100th percentile).
The options market exhibits an inverted term structure (backwardation) favoring calendar or diagonal spreads, with a slightly negatively sloped skew supporting put and call spreads.
Open interest extends to March 2026, with balanced call and put interest across most expiries, except for March 2026, which is heavily call-dominated.


Xiaomi Corp (1810 HK): Volatility Insights and Analysis Identify Spread Opportunities

<ul>
<li>Over the past five trading days, <a href="https://www.smartkarma.com/entities/xiaomi-corp" target="_blank" data-smartkarma-citation="entities:24409:1" rel="noopener"><strong>Xiaomi</strong> Corp (1810 HK)</a> multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.</li>
<li>Bearish and Bullish strategies balance each other, with only 12% of trades expressing a neutral view, such as Iron Condors. Some strategies were traded in unusually large size.</li>
<li>Diagonal Spreads account for over 25% of all strategies and can make for near self-financing strategies. An inverted volatility term structure, aka backwardation, supports calendar and diagonal spreads.</li>
</ul>


Over the past five trading days, Xiaomi Corp (1810 HK) multi-leg option strategies showcased a variety of approaches. Strategy highlights are provided.
Bearish and Bullish strategies balance each other, with only 12% of trades expressing a neutral view, such as Iron Condors. Some strategies were traded in unusually large size.
Diagonal Spreads account for over 25% of all strategies and can make for near self-financing strategies. An inverted volatility term structure, aka backwardation, supports calendar and diagonal spreads.


Xiaomi Corp (1810 HK): Top Trades and Strategic Insights from HKEX Options Trading

<ul>
<li>One-Month implied volatility for <a href="https://www.smartkarma.com/entities/meituan" target="_blank" data-smartkarma-citation="entities:26970:1" rel="noopener">Meituan (3690 HK)</a> has decreased from recent highs to around its three-year median, while realized volatility, a lagging indicator, remains significantly higher at the 87th percentile.</li>
<li>The term structure is flat, with May and June implied volatilities nearly identical, indicating no significant impact from the upcoming earnings announcement in early June.</li>
<li>Open interest is spread over the next nine months, with April calls concentrated at strikes 145 to 150 and deep out of the money calls at strikes 180 to 200.</li>
</ul>


One-Month implied volatility for Meituan (3690 HK) has decreased from recent highs to around its three-year median, while realized volatility, a lagging indicator, remains significantly higher at the 87th percentile.
The term structure is flat, with May and June implied volatilities nearly identical, indicating no significant impact from the upcoming earnings announcement in early June.
Open interest is spread over the next nine months, with April calls concentrated at strikes 145 to 150 and deep out of the money calls at strikes 180 to 200.


Meituan (3690 HK): Options Insights and Analysis, Skew Shift Amid Earnings Calm

China

The Hang Seng China Enterprises Index is a free-float capitalization-weighted index comprised of H-Shares listed on the Hong Kong Stock Exchange and included in the Hang Seng Mainland Composite Index. The base value of this index is 2000 as of Jan 3, 2000. This index replaced the old HSCE index on Oct. 3, 2001.

Hang Seng China Enterprises Index (HSCEI INDEX)

Hang Seng China Enterprises Index (HSCEI INDEX)

Overview#24 – Exiting No Man’s Land

A review of recent events/data impacting our investment themes and outlook. What are bond and currency markets telling us about the equity markets?

Rikki Malik

China: Tariff Walls to Exacerbate Capital Flight, Deflation, Over-Capacity Challenges

Record rise in TSF drove strong 1Q2025 industrial & GDP growth. Trade surplus US$1.08trn in year to Mar'25, but FX reserves flat, indicating...

Prasenjit K. Basu

Xiaomi Corp (1810 HK): Volatility Insights and Analysis Identify Spread Opportunities

Xiaomi's implied and realized volatility remains high with the options market showing opportunities for calendar spreads and diagonal spreads.

Gaudenz Schneider

Xiaomi Corp (1810 HK): Top Trades and Strategic Insights from HKEX Options Trading

Xiaomi Corp's multi-leg option strategies show diverse approaches with a mix of bullish and bearish trades, including large trades and self...

Gaudenz Schneider

Meituan (3690 HK): Options Insights and Analysis, Skew Shift Amid Earnings Calm

Meituan's implied volatility has dropped to median levels, but realized volatility remains high. Flat term structure suggests little impact from...

Gaudenz Schneider

Overview#24 – Exiting No Man’s Land

A review of recent events/data impacting our investment themes and outlook. What are bond and currency markets telling us about the equity markets?

Rikki Malik

China: Tariff Walls to Exacerbate Capital Flight, Deflation, Over-Capacity Challenges

​Record rise in TSF drove strong 1Q2025 industrial & GDP growth. Trade surplus US$1.08trn in year to Mar'25, but FX reserves flat, indicating...

Prasenjit K. Basu

Xiaomi Corp (1810 HK): Volatility Insights and Analysis Identify Spread Opportunities

​Xiaomi's implied and realized volatility remains high with the options market showing opportunities for calendar spreads and diagonal spreads.

Gaudenz Schneider

Xiaomi Corp (1810 HK): Top Trades and Strategic Insights from HKEX Options Trading

​Xiaomi Corp's multi-leg option strategies show diverse approaches with a mix of bullish and bearish trades, including large trades and self...

Gaudenz Schneider

Meituan (3690 HK): Options Insights and Analysis, Skew Shift Amid Earnings Calm

​Meituan's implied volatility has dropped to median levels, but realized volatility remains high. Flat term structure suggests little impact from...

Gaudenz Schneider

Record rise in TSF drove strong 1Q2025 industrial & GDP growth. Trade surplus US$1.08trn in year to Mar'25, but FX reserves flat, indicating...

Xiaomi's implied and realized volatility remains high with the options market showing opportunities for calendar spreads and diagonal spreads.

Xiaomi Corp's multi-leg option strategies show diverse approaches with a mix of bullish and bearish trades, including large trades and self...

Meituan's implied volatility has dropped to median levels, but realized volatility remains high. Flat term structure suggests little impact from...