Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Thematic (Sector/Industry)

Since autumn of 2014, the HK-Shanghai Connect, and later the HK-Shenzhen Connect mechanisms have provided means for mainland investors to buy Hong Kong-listed stocks. We have been tracking the H/A relationships and the Southbound flows per name on a weekly basis and occasionally writing commentary about it since late 2016. This report provides a brief synopsis of the SOUTHBOUND flows into Hong Kong-listed stocks over the course of 2018, by sector, by average percentage change in mainland ownership of HK shares outstanding subject to the Connect mechanisms, and the top and bottom five names per sector per quarter.

Since autumn of 2014, the HK-Shanghai Connect, and later the HK-Shenzhen Connect mechanisms have provided means for mainland investors to buy Hong Kong-listed stocks. We have been tracking the H/A relationships and the Southbound flows per name on a weekly basis and occasionally writing commentary about it since late 2016. This report provides a brief synopsis of the SOUTHBOUND flows into Hong Kong-listed stocks over the course of 2018, by sector, by average percentage change in mainland ownership of HK shares outstanding subject to the Connect mechanisms, and the top and bottom five names per sector per quarter.

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 changes to the Hang Seng family of indices were announced post market close on Friday - final capping will use closing prices from 2 June.</li>
<li>There are 3 adds for the <a href="https://www.smartkarma.com/entities/hong-kong-hang-seng-index" target="_blank" data-smartkarma-citation="entities:22899:1" rel="noopener">HSI</a>, 2 changes each for the<a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener"> HSCEI</a> and <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH</a>, 1 change for the HSBIO Index and 7 adds for the HSCI Index.</li>
<li>There will be positioning in most stocks but there could be continued positioning in the names that will be added to Southbound Stock Connect.</li>
</ul>


The changes to the Hang Seng family of indices were announced post market close on Friday - final capping will use closing prices from 2 June.
There are 3 adds for the HSI, 2 changes each for the HSCEI and HSTECH, 1 change for the HSBIO Index and 7 adds for the HSCI Index.
There will be positioning in most stocks but there could be continued positioning in the names that will be added to Southbound Stock Connect.


Hang Seng Indexes: Changes Lead to US$6.6bn Trade; Plus Stock Connect & Global Index Inclusions

<ul>
<li>The Hang Seng indices announced June 2026 index review changes on Friday. Most changes to indices with significant tracking AUM were as expected. Quiddity correctly predicted 11/11 ex-HSI.</li>
<li>HSI was, as always, a process of dart-throwing. HSI is trying to add stocks to increase count, and by our analysis, needed to add names from Healthcare, Industrials, and Materials. </li>
<li>HSI selected one from each. Among the 6 top indices affected, there is HK$29bn to trade across 200 names, but only 12 with more than one day of ADV.</li>
</ul>


The Hang Seng indices announced June 2026 index review changes on Friday. Most changes to indices with significant tracking AUM were as expected. Quiddity correctly predicted 11/11 ex-HSI.
HSI was, as always, a process of dart-throwing. HSI is trying to add stocks to increase count, and by our analysis, needed to add names from Healthcare, Industrials, and Materials. 
HSI selected one from each. Among the 6 top indices affected, there is HK$29bn to trade across 200 names, but only 12 with more than one day of ADV.


[Quiddity Index] HSI Rebal Results Almost All As Predicted - HK$29bn One-Way

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.

<ul>
<li>Hang Seng announced index review for the June 2026 Rebalance. Our pre-announcement note dated 11 May 2026 called both ADD candidates and both DELETE candidates correctly.</li>
<li>We analyzed dynamics around two ADDs, from a historical perspective, on the post-announcement positioning.</li>
<li>We also analyzed dynamics around two DELETEs. Both DELETEs fell by similar magnitudes with slightly above-baseline volume</li>
</ul>


Hang Seng announced index review for the June 2026 Rebalance. Our pre-announcement note dated 11 May 2026 called both ADD candidates and both DELETE candidates correctly.
We analyzed dynamics around two ADDs, from a historical perspective, on the post-announcement positioning.
We also analyzed dynamics around two DELETEs. Both DELETEs fell by similar magnitudes with slightly above-baseline volume


HS TECH June 2026 Rebalance: Post-Announcement Positioning

<ul>
<li>We screen the HS TECH eligible universe ahead of the index's May 2026 quarterly review.</li>
<li>Both of the ADD candidates are well within the ADD zone.</li>
<li>One delete is now in the forced delete zone at rank 37, the second remains in the buffer zone.</li>
</ul>


We screen the HS TECH eligible universe ahead of the index's May 2026 quarterly review.
Both of the ADD candidates are well within the ADD zone.
One delete is now in the forced delete zone at rank 37, the second remains in the buffer zone.


China

Kingdee International Software Group is a leading provider of cloud-based enterprise management SaaS solutions and enterprise resource planning (ERP) software. The company offers solutions for financial management, human resources, supply chain, and manufacturing, often powered by AI. It was established in 1993 and is headquartered in Shenzhen, China.

Kingdee International Software Group (268 HK)

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Kingdee International Software Group (268 HK)

2018 HK-Connect SouthBound In a Nutshell

Since autumn of 2014, the HK-Shanghai Connect, and later the HK-Shenzhen Connect mechanisms have provided means for mainland investors to buy Hong...

Travis Lundy

Hang Seng Indexes: Changes Lead to US$6.6bn Trade; Plus Stock Connect & Global Index Inclusions

There are a number of constituent, float and capping changes for the Hang Seng family, leading to a US$6.6bn trade. Stock Connect additions, lock...

Brian Freitas

[Quiddity Index] HSI Rebal Results Almost All As Predicted - HK$29bn One-Way

The Hang Seng indices announced review results on Friday. The inclusion/exclusion date is 5 June. Capping is finalised three days before. 14...

Travis Lundy

HS TECH June 2026 Rebalance: Post-Announcement Positioning

HSTECH June 2026 post-announcement cycle is starting. ADD setup is stock-specific after divergent WPreA2 moves. DELETE continuation depends on WAI0...

Ke Yan, CFA, FRM

HS TECH Index May 2026 Review Forecast

HS TECH May 2026 rebalance announcement due after market close today: a good time to revisit our review forecast as the decision approaches.

Ke Yan, CFA, FRM

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