Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Index Rebalance

<ul>
<li>We analyzed the performance of Hong Kong Connect implementation in March 2026.</li>
<li>ADD stocks reversed their bridge window drawdown at implementation. The bounce faded by week 3 to 4.</li>
<li>DELETE stocks fell through first week, exceeding Sep 2025. Within the DELETE basket, the names where connect investors sold the most also fell the most.</li>
</ul>


We analyzed the performance of Hong Kong Connect implementation in March 2026.
ADD stocks reversed their bridge window drawdown at implementation. The bounce faded by week 3 to 4.
DELETE stocks fell through first week, exceeding Sep 2025. Within the DELETE basket, the names where connect investors sold the most also fell the most.


HSCI / HK Connect (March 2026) Post-Event Review: What Worked, What Didn't

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>HK Alpha portfolio gained 3.45% in August, outperforming its benchmark by 2.67%.  Since inception, the portfolio has outperformed HK indexes by 60% to 84%. HK ALPHA is up 14.35% YTD.</li>
<li>The Sharpe ratio stands at 1.21, compared with a benchmark of 0.68 since inception.  This higher Sharpe ratio is driven by excess alpha, which represents more than 50% of returns.</li>
<li>The portfolio gained in the healthcare, industrial, and technology sectors in August, while utilities and telecom exposure dragged on performance.</li>
</ul>


HK Alpha portfolio gained 3.45% in August, outperforming its benchmark by 2.67%.  Since inception, the portfolio has outperformed HK indexes by 60% to 84%. HK ALPHA is up 14.35% YTD.
The Sharpe ratio stands at 1.21, compared with a benchmark of 0.68 since inception.  This higher Sharpe ratio is driven by excess alpha, which represents more than 50% of returns.
The portfolio gained in the healthcare, industrial, and technology sectors in August, while utilities and telecom exposure dragged on performance.


Event-Driven

<ul>
<li>Shanghai Stock Exchange and Shenzhen Stock Exchange confirmed 40 ADDs and 25 DELETEs for Connect implementation on 9 March 2026.</li>
<li>The DELETE trade has worked well, with mean WAI return of -10.0% (21/25 negative); ADD stocks underperformed during WAI at -3.3% mean, consistent with the September 2025 event study.</li>
<li>Selectivity remains critical into implementation: favor narrative-aligned ADDs with moderate pre-event extension, maintain DELETE shorts on high-Connect-holding names, and monitor the three delayed ADDs for secondary entry points.</li>
</ul>


Shanghai Stock Exchange and Shenzhen Stock Exchange confirmed 40 ADDs and 25 DELETEs for Connect implementation on 9 March 2026.
The DELETE trade has worked well, with mean WAI return of -10.0% (21/25 negative); ADD stocks underperformed during WAI at -3.3% mean, consistent with the September 2025 event study.
Selectivity remains critical into implementation: favor narrative-aligned ADDs with moderate pre-event extension, maintain DELETE shorts on high-Connect-holding names, and monitor the three delayed ADDs for secondary entry points.


HSCI / HK Connect (March 2026): Implementation Today & Positioning

Global Healthcare Analyst

Tina Banerjee

Equity Bottom-Up

<ul>
<li>
<a href="https://www.smartkarma.com/entities/insilico-medicine-cayman-topco" target="_blank" data-smartkarma-citation="entities:39890:1" rel="noopener">InSilico Medicine Cayman TopCo (ISM HK)</a> shares rallied more than 200% since debut on HK stock exchange. The rally is backed by successive deals stuck with renowned pharmaceutical companies.</li>
<li>InSilico Medicine and China Medical System Holdings entered into a strategic partnership to advance a series of AI-empowered drug discovery collaborations across multiple projects in CNS and autoimmune diseases.</li>
<li>Insilico’s AI-driven platform validated by rapidly bringing multiple drug candidates to IND enabling and clinical stage and business development expertise leading to multiple out-licensing collaborations entail long-term growth prospect.</li>
</ul>



InSilico Medicine Cayman TopCo (ISM HK) shares rallied more than 200% since debut on HK stock exchange. The rally is backed by successive deals stuck with renowned pharmaceutical companies.
InSilico Medicine and China Medical System Holdings entered into a strategic partnership to advance a series of AI-empowered drug discovery collaborations across multiple projects in CNS and autoimmune diseases.
Insilico’s AI-driven platform validated by rapidly bringing multiple drug candidates to IND enabling and clinical stage and business development expertise leading to multiple out-licensing collaborations entail long-term growth prospect.


InSilico Medicine (ISM HK): Firing on Both Cylinders

<ul>
<li>Hang Seng Index Company announced HSCI review results after market close on Feb 13. In our previous note, we reviewed the Sep 2025 HK Connect cycle.</li>
<li>In this note, we provide an update on the forecasted upcoming implementation action by the mainland exchanges based on implementation rules and highlight stock performance thus far.</li>
<li>Our analysis suggests that selectivity will be critical in this cycle, with differentiation driven by pre-positioning, narrative alignment, and ownership structure rather than mechanical inclusion alone.</li>
</ul>


Hang Seng Index Company announced HSCI review results after market close on Feb 13. In our previous note, we reviewed the Sep 2025 HK Connect cycle.
In this note, we provide an update on the forecasted upcoming implementation action by the mainland exchanges based on implementation rules and highlight stock performance thus far.
Our analysis suggests that selectivity will be critical in this cycle, with differentiation driven by pre-positioning, narrative alignment, and ownership structure rather than mechanical inclusion alone.


HK Connect March 2026: Implementation Forecast and Positioning Framework

Hong Kong

Insilico Medicine is an artificial intelligence (AI)-based biotechnology company that applies AI solutions to drug discovery and development, leveraging its proprietary Pharma.AI platform to identify and design early-stage drug candidates. The company develops novel drugs for various diseases, including cancer, fibrosis, immunity, and central nervous system disorders, and predicts clinical trial outcomes. Insilico Medicine was founded in 2014 and is headquartered in New Territories, Hong Kong.

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Insilico Medicine (3696 HK)

HSCI / HK Connect (March 2026) Post-Event Review: What Worked, What Didn't

HK Connect Mar 2026 implementation cycle is completing. ADD reversed the WAI drawdown at implementation. DELETE continuation worked post...

Ke Yan, CFA, FRM

HONG KONG ALPHA PORTFOLIO: (August 2026)

HK Alpha portfolio gained 3.45% in August, outperforming its benchmark by 2.67%. Since inception, the portfolio has outperformed HK indexes by 60%...

David Mudd

HSCI / HK Connect (March 2026): Implementation Today & Positioning

HSCI rebal/HK Connect implementation on March 9th: We provide a follow-up note on what have done well and what to monitor.

Ke Yan, CFA, FRM

InSilico Medicine (ISM HK): Firing on Both Cylinders

Insilico Medicine announced that ISM4808, an AI-driven potential best-in-class oral drug candidate for CKD-related anemia previously out-licensed...

Tina Banerjee

HK Connect March 2026: Implementation Forecast and Positioning Framework

March Connect implementation is nearing: we forecast expected ADD/DELETE actions and assess how positioning, crowding, and southbound flows may...

Ke Yan, CFA, FRM

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