HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>Following Trump's threats on tariffs and pull-out of meeting with Xi, the 5% collapse in the HSI futures implies a heavy sell-off in HK when the market reopens.</li>
<li>The stocks with the best YTD performance and significant strengths in the last month are the prime candidates most vulnerable to the initial collapse. </li>
<li>
<a href="https://www.smartkarma.com/entities/semiconductor-manufacturing-international-corp-smic" target="_blank" data-smartkarma-citation="entities:14231:1" rel="noopener">Semiconductor Manufacturing International Corp (SMIC) (981 HK)</a>, <a href="https://www.smartkarma.com/entities/kuaishou-technology" target="_blank" data-smartkarma-citation="entities:29725:1" rel="noopener">Kuaishou Technology (1024 HK)</a>, <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd-d7b798e2-202d-4e01-9a1e-799e2ae8f0c7" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba (9988 HK)</a>, and <a href="https://www.smartkarma.com/entities/hua-hong-semiconductor-ltd" target="_blank" data-smartkarma-citation="entities:7201:1" rel="noopener">Hua Hong Semiconductor (1347 HK)</a> are badly exposed.</li>
</ul>


Following Trump's threats on tariffs and pull-out of meeting with Xi, the 5% collapse in the HSI futures implies a heavy sell-off in HK when the market reopens.
The stocks with the best YTD performance and significant strengths in the last month are the prime candidates most vulnerable to the initial collapse. 

Semiconductor Manufacturing International Corp (SMIC) (981 HK), Kuaishou Technology (1024 HK), Alibaba (9988 HK), and Hua Hong Semiconductor (1347 HK) are badly exposed.


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

Rikki Malik

Commodities

<ul>
<li>A review of recent events/data impacting our investment themes and outlook</li>
<li>Negotiations between the US and China are not going well, to say the least!</li>
<li>We review the short-term outlook for some of the sectors we focus on.</li>
</ul>


A review of recent events/data impacting our investment themes and outlook
Negotiations between the US and China are not going well, to say the least!
We review the short-term outlook for some of the sectors we focus on.


OV #37 – From Chips to Ships: Markets Rattle as Trade War Escalates

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>
Context: Friday’s sell-off occurred after the Hong Kong market closed, but several Hong Kong–listed companies were caught up in the rout through their U.S.-listed ADRs.</li>
<li>This Insight details the impact on 15 prominent Hang Seng Index constituents — including Alibaba, Tencent, and HSBC. Implied volatility in U.S.-traded options on these ADRs moved sharply in response.</li>
<li>
Why Read: Understand what to expect when the Hong Kong market reopens after the weekend — both in terms of price performance and implied volatility.</li>
</ul>



Context: Friday’s sell-off occurred after the Hong Kong market closed, but several Hong Kong–listed companies were caught up in the rout through their U.S.-listed ADRs.
This Insight details the impact on 15 prominent Hang Seng Index constituents — including Alibaba, Tencent, and HSBC. Implied volatility in U.S.-traded options on these ADRs moved sharply in response.

Why Read: Understand what to expect when the Hong Kong market reopens after the weekend — both in terms of price performance and implied volatility.


Alibaba Drops 8%: What Friday’s U.S. Sell-Off Means for Hong Kong Stocks

Cross Asset Strategy

<ul>
<li>How have our major investment themes performed so far in 2025?</li>
<li>Review of the performance of the major markets and asset classes we focus on</li>
<li>We revisit our outlook for each of those asset classes for Q4 25</li>
</ul>


How have our major investment themes performed so far in 2025?
Review of the performance of the major markets and asset classes we focus on
We revisit our outlook for each of those asset classes for Q4 25


Q4 Outlook for Our Investment Themes Part 2 - Asian Equities

<ul>
<li>
Context: Volatility cones provide a straightforward framework to evaluate whether options are trading cheap or rich. This Insight provides volatility analysis for 8 prominent Hong Kong stocks and the benchmark index.</li>
<li>
Highlights: In contrast, Alibaba’s IV remains rich, while Hang Seng Index IV is cheap across the curve, offering attractive hedge entry points.</li>
<li>
Why Read: Spot opportunities, assess regime shifts, and manage risk effectively — volatility cones turn complex data into actionable insights for traders and investors.</li>
</ul>



Context: Volatility cones provide a straightforward framework to evaluate whether options are trading cheap or rich. This Insight provides volatility analysis for 8 prominent Hong Kong stocks and the benchmark index.

Highlights: In contrast, Alibaba’s IV remains rich, while Hang Seng Index IV is cheap across the curve, offering attractive hedge entry points.

Why Read: Spot opportunities, assess regime shifts, and manage risk effectively — volatility cones turn complex data into actionable insights for traders and investors.


Cheap Vs. Rich Volatility: Diverging Signals Across Alibaba (9988 HK), Tencent (700 HK) & The HSI

Hong Kong

The Hang Seng TECH Index aims to represent the 30 largest technology companies listed in Hong Kong which have high business exposure to the Innovative Tech Themes.

Hang Seng TECH Index (HSTECH INDEX EQUITY)

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Hang Seng TECH Index (HSTECH INDEX EQUITY)

HK Strategy: Who Will Suffer the Most?

Trump's tariff threats and market uncertainty lead to a potential heavy sell-off in HK, with top-performing stocks like SMIC, Kuaishou, Alibaba,...

Osbert Tang, CFA

OV #37 – From Chips to Ships: Markets Rattle as Trade War Escalates

A review of recent events/data impacting our investment themes and outlook. We look at the fallout from the recent escalation of the trade war

Rikki Malik

Alibaba Drops 8%: What Friday’s U.S. Sell-Off Means for Hong Kong Stocks

Friday’s sell-off hit China ADRs and pushed implied volatility higher, but not all stocks were affected equally. This Insight details the price...

Gaudenz Schneider

Q4 Outlook for Our Investment Themes Part 2 - Asian Equities

A review of the performance of how our major investment themes have performed in 2025 and our outlook for Q4 and beyond.

Rikki Malik

Cheap Vs. Rich Volatility: Diverging Signals Across Alibaba (9988 HK), Tencent (700 HK) & The HSI

Volatility cones reveal contrasting signals — Alibaba’s IV stays rich, Tencent trades nearly cheap, and the Hang Seng Index shows low IV,...

Gaudenz Schneider

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

HK Strategy: Who Will Suffer the Most?

​Trump's tariff threats and market uncertainty lead to a potential heavy sell-off in HK, with top-performing stocks like SMIC, Kuaishou, Alibaba,...

Osbert Tang, CFA

OV #37 – From Chips to Ships: Markets Rattle as Trade War Escalates

A review of recent events/data impacting our investment themes and outlook. We look at the fallout from the recent escalation of the trade war

Rikki Malik

Alibaba Drops 8%: What Friday’s U.S. Sell-Off Means for Hong Kong Stocks

Friday’s sell-off hit China ADRs and pushed implied volatility higher, but not all stocks were affected equally. This Insight details the price...

Gaudenz Schneider

Q4 Outlook for Our Investment Themes Part 2 - Asian Equities

​A review of the performance of how our major investment themes have performed in 2025 and our outlook for Q4 and beyond.

Rikki Malik

Cheap Vs. Rich Volatility: Diverging Signals Across Alibaba (9988 HK), Tencent (700 HK) & The HSI

Volatility cones reveal contrasting signals — Alibaba’s IV stays rich, Tencent trades nearly cheap, and the Hang Seng Index shows low IV,...

Gaudenz Schneider

Trump's tariff threats and market uncertainty lead to a potential heavy sell-off in HK, with top-performing stocks like SMIC, Kuaishou, Alibaba,...

A review of the performance of how our major investment themes have performed in 2025 and our outlook for Q4 and beyond.