Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

Korea Stock Exchange Kospi Index / Event-Driven

<ul>
<li>FSC’s rule gives same‑day vote ratios, offering quick sentiment read and partial visibility on appraisal risk—step one toward faster hard‑count disclosure down the line.</li>
<li>Hard count of dissenting shares only surfaces in quarterly reports, post‑appraisal window—denominator risk stays live for corp‑action trades tied to appraisal rights.</li>
<li>FSC rule applies from March ’26 AGMs/EGMs; half‑baked disclosure, but appraisal‑linked corp‑actions may see new post‑meeting trading patterns—stay prepped for the shift.</li>
</ul>


FSC’s rule gives same‑day vote ratios, offering quick sentiment read and partial visibility on appraisal risk—step one toward faster hard‑count disclosure down the line.
Hard count of dissenting shares only surfaces in quarterly reports, post‑appraisal window—denominator risk stays live for corp‑action trades tied to appraisal rights.
FSC rule applies from March ’26 AGMs/EGMs; half‑baked disclosure, but appraisal‑linked corp‑actions may see new post‑meeting trading patterns—stay prepped for the shift.


Korea FSC’s New Vote‑Split Disclosure Rule: What It Really Means for Appraisal Risk

<ul>
<li>NPS’s new SMID mandates use a benchmark, an 80/20 mix of the KOSPI Mid+Small Cap (Size Index) and KOSDAQ150, with ~₩500bn total, implying roughly a 20% step-up in mid/small-cap exposure.</li>
<li>March KOSPI large→mid-cap migration could trigger significant passive flows, unlike last September when policy rallies and APR index noise distorted flow–price impact correlation.</li>
<li>NPS compressed its SMID trading window near the effective date, hinting at tighter rebalancing; with ~20% mid-cap exposure bump in March, this could create a notable price impact trade.</li>
</ul>


NPS’s new SMID mandates use a benchmark, an 80/20 mix of the KOSPI Mid+Small Cap (Size Index) and KOSDAQ150, with ~₩500bn total, implying roughly a 20% step-up in mid/small-cap exposure.
March KOSPI large→mid-cap migration could trigger significant passive flows, unlike last September when policy rallies and APR index noise distorted flow–price impact correlation.
NPS compressed its SMID trading window near the effective date, hinting at tighter rebalancing; with ~20% mid-cap exposure bump in March, this could create a notable price impact trade.


NPS Announces New Local SMID Fund Managers: Could Impact March KOSPI Size Index Migration Event

<ul>
<li>M&amp;A valuations won’t rely solely on market prices, carve-outs favor parent shareholders, and mandatory tender offers plus IPO cornerstones lead, with tender offers live H1 next year.</li>
<li>Commercial Act tweaks have tackled governance, and the tax reform boosts dividends. Today's markets reform package addresses the last missing piece: giving minority shareholders a fair shake in M&amp;A scenarios.</li>
<li>Details and timelines remain unclear, but the package sets a roadmap to improve Korea’s equity risk-return profile, supporting DM inclusion upside and maintaining the Korea Premium narrative.</li>
</ul>


M&amp;A valuations won’t rely solely on market prices, carve-outs favor parent shareholders, and mandatory tender offers plus IPO cornerstones lead, with tender offers live H1 next year.
Commercial Act tweaks have tackled governance, and the tax reform boosts dividends. Today's markets reform package addresses the last missing piece: giving minority shareholders a fair shake in M&amp;A scenarios.
Details and timelines remain unclear, but the package sets a roadmap to improve Korea’s equity risk-return profile, supporting DM inclusion upside and maintaining the Korea Premium narrative.


Korea Capital Market Reform Package Just Unveiled: Korea Premium Narrative Holds

<ul>
<li>If KRX adopts NXT’s pre- and after-hours fully, liquidity spreads out, weakening gap open plays and shifting focus to large-cap, event-driven LP-driven flows.</li>
<li>With T+1 settlement coming, traders expect settlement pressure to fuel price dislocations—especially in ETF rebalancing and foreign-heavy stocks, where flow and FX risks may drive fresh discounts and volatility.</li>
<li>Though launched pre-new admin, FSC’s plans align with the government’s push to boost KOSPI liquidity, making cancellations unlikely. Expect fast rollout—time to prep trading setups now.</li>
</ul>


If KRX adopts NXT’s pre- and after-hours fully, liquidity spreads out, weakening gap open plays and shifting focus to large-cap, event-driven LP-driven flows.
With T+1 settlement coming, traders expect settlement pressure to fuel price dislocations—especially in ETF rebalancing and foreign-heavy stocks, where flow and FX risks may drive fresh discounts and volatility.
Though launched pre-new admin, FSC’s plans align with the government’s push to boost KOSPI liquidity, making cancellations unlikely. Expect fast rollout—time to prep trading setups now.


Korea FSC Plans KRX to Match NXT Trading Hours and Move to T+1 Settlement

<ul>
<li>Even the revised draft is facing possible first-ever presidential non-approval, which acts like a de facto veto between Cabinet approval and National Assembly submission.</li>
<li>The admin aims to make stocks outperform real estate, with a dividend tax cut under separate taxation as the key lever, fully recognized by the Presidential Office.</li>
<li>Local markets are pulling back on Presidential Office delays, but signals point to a clear reform direction — time to build mid-term positions in banks and holdcos.</li>
</ul>


Even the revised draft is facing possible first-ever presidential non-approval, which acts like a de facto veto between Cabinet approval and National Assembly submission.
The admin aims to make stocks outperform real estate, with a dividend tax cut under separate taxation as the key lever, fully recognized by the Presidential Office.
Local markets are pulling back on Presidential Office delays, but signals point to a clear reform direction — time to build mid-term positions in banks and holdcos.


Real-Time Read on Korea’s Top Market Narrative — Tax Reform Play

South Korea

The KOSPI Index is a capitalization-weighted index of all common shares on the Korean Stock Exchanges. The Index was developed with a base value of 100 as of January 4, 1980. Note: The preferred shares are excluded in calculating the KOSPI Index from June 14, 2002. 

Korea Stock Exchange Kospi Index (KOSPI INDEX)

Korea Stock Exchange Kospi Index (KOSPI INDEX)

Korea FSC’s New Vote‑Split Disclosure Rule: What It Really Means for Appraisal Risk

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