Independent Sell Side Equity Research Analyst, ChartSmarter

Douglas Busch

Independent Sell Side Equity Research Analyst

ChartSmarter

ChartSmarter is a service dedicated to the art of technical analysis.

On a daily basis we write up actionable ideas on a specific, major S&P sector on both the long and short side, in an easy yet thorough way. In the notes we give precise entries and exits, while looking to capture the "meat" of a trend.

Technical Analysis.

Technical Analysis

KraneShares CSI China Internet ETF / Technical Analysis

<ul>
<li>KWEB giving an attractive entry point here, as it begins to outperform the domestic FDN.</li>
<li>Toyota&gt;Honda and look for that relationship to continue going forward.</li>
<li>JD&gt;BABA, a new dynamic divergence between the two, and my opinion is JD will be the leader in 2024 and beyond.</li>
</ul>


KWEB giving an attractive entry point here, as it begins to outperform the domestic FDN.
Toyota&gt;Honda and look for that relationship to continue going forward.
JD&gt;BABA, a new dynamic divergence between the two, and my opinion is JD will be the leader in 2024 and beyond.


KWEB Attractive, Toyota and JD.com Best in Breed

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

KraneShares CSI China Internet ETF / Event-Driven

<ul>
<li>The PCAOB has not, despite a cooperation agreement with the CSRC signed in 2013, been able to conduct on-site investigations of a HK or mainland-based company since 2010.</li>
<li>On Friday, the CSRC published a new Strengthening Confidentiality and File Management Related to Overseas Issuance to replace 2009 rules. </li>
<li>Importantly, the revised Provisions deletes the stipulation that “on-site inspections shall be dominated by domestic regulators or depend on the conclusions of inspections by domestic regulators.” Will it be enough?</li>
</ul>


The PCAOB has not, despite a cooperation agreement with the CSRC signed in 2013, been able to conduct on-site investigations of a HK or mainland-based company since 2010.
On Friday, the CSRC published a new Strengthening Confidentiality and File Management Related to Overseas Issuance to replace 2009 rules. 
Importantly, the revised Provisions deletes the stipulation that “on-site inspections shall be dominated by domestic regulators or depend on the conclusions of inspections by domestic regulators.” Will it be enough?


New CSRC "Provisions" Take a Step Towards Meeting PCAOB Requirements

<ul>
<li>Friday in US time, the China Securities Regulatory Commission (CSRC), China's MOF, and the US Public Company Accounting Oversight Board (PCAOB) "agreed" on a Statement of Protocol.</li>
<li>This SoP sets the outlines for PCAOB access to inspect/investigate audit papers and accounting firms in China and HK for companies listed in the US.</li>
<li>The releases' difference in language is to be expected - different constituencies - but as PCAOB Chair Williams said, <em>“Now we will find out whether those promises hold up."</em>
</li>
</ul>


Friday in US time, the China Securities Regulatory Commission (CSRC), China's MOF, and the US Public Company Accounting Oversight Board (PCAOB) "agreed" on a Statement of Protocol.
This SoP sets the outlines for PCAOB access to inspect/investigate audit papers and accounting firms in China and HK for companies listed in the US.
The releases' difference in language is to be expected - different constituencies - but as PCAOB Chair Williams said, “Now we will find out whether those promises hold up."



CSRC and PCAOB "Agree" On Audit Terms - Now PCAOB Will Try To Prove a Negative

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

<ul>
<li>The announcement of the inclusion of <a href="https://www.smartkarma.com/entities/uber-technologies-inc" target="_blank" data-smartkarma-citation="entities:430:1" rel="noopener">Uber Technologies (UBER US)</a> in the <a href="https://www.smartkarma.com/entities/s-p-500-index" target="_blank" data-smartkarma-citation="entities:22886:1" rel="noopener">S&amp;P 500 INDEX</a> was a big one last week. There were announcements for some other indices too.</li>
<li>There are many indices in China that will be rebalanced at the close on Friday, the biggest being the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300</a>, <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI 500</a>, <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50</a>, <a href="https://www.smartkarma.com/entities/shanghai-stock-exchange-sse-50-a-share-index" target="_blank" data-smartkarma-citation="entities:31073:1" rel="noopener">SSE50</a> and <a href="https://www.smartkarma.com/entities/kraneshares-csi-china-internet-etf" target="_blank" data-smartkarma-citation="entities:28208:1" rel="noopener">KWEB US</a>.</li>
<li>Relatively quiet in ETF world with net inflows to China focused ETFs and net outflows for Japan.</li>
</ul>


The announcement of the inclusion of Uber Technologies (UBER US) in the S&amp;P 500 INDEX was a big one last week. There were announcements for some other indices too.
There are many indices in China that will be rebalanced at the close on Friday, the biggest being the CSI 300, CSI 500, STAR50, SSE50 and KWEB US.
Relatively quiet in ETF world with net inflows to China focused ETFs and net outflows for Japan.


Index Rebalance & ETF Flow Recap: KWEB, CSI300/500, STAR50, SSE50, ChiNext, SET50, Chips, Denso, SPX

<ul>
<li>The December rebalance of the <a href="https://www.smartkarma.com/entities/kraneshares-csi-china-internet-etf" target="_blank" data-smartkarma-citation="entities:28208:1" rel="noopener">KraneShares CSI China Internet ETF (KWEB US)</a> will take place at the close of trading on 8 December.</li>
<li>
<a href="https://www.smartkarma.com/entities/fenbi-ltd" target="_blank" data-smartkarma-citation="entities:36640:1" rel="noopener">Fenbi Ltd (2469 HK)</a> and <a href="https://www.smartkarma.com/entities/ysb-inc" target="_blank" data-smartkarma-citation="entities:35982:1" rel="noopener">YSB (9885 HK)</a> will be added to the index and there are no deletions.</li>
<li>There is a big lock-up expiry in <a href="https://www.smartkarma.com/entities/ysb-inc" target="_blank" data-smartkarma-citation="entities:35982:1" rel="noopener">YSB (9885 HK)</a> soon after the index inclusion and this could be an opportunity to access liquidity in the stock.</li>
</ul>


The December rebalance of the KraneShares CSI China Internet ETF (KWEB US) will take place at the close of trading on 8 December.

Fenbi Ltd (2469 HK) and YSB (9885 HK) will be added to the index and there are no deletions.
There is a big lock-up expiry in YSB (9885 HK) soon after the index inclusion and this could be an opportunity to access liquidity in the stock.


KWEB Index Rebalance: Fenbi (2469 HK) & YSB (9885 HK) Added

United States

KraneShares CSI China Internet Fund is an exchange-traded fund incorporated in the USA. The fund tracks the CSI Overseas China Internet Index. It invests in a universe of publicly traded China-based companies whose primary business is in the Internet and Internet-related sectors. It attempts to offer exposure to companies that benefit from increasing consumption by China's growing middle class.

KraneShares CSI China Internet ETF (KWEB US)

KraneShares CSI China Internet ETF (KWEB US)

KWEB Attractive, Toyota and JD.com Best in Breed

Chinese softness feels like a rear view mirror story. Leaders in Japan likely to continue to flourish. Invest accordingly.

Douglas Busch

New CSRC "Provisions" Take a Step Towards Meeting PCAOB Requirements

CSRC has published new Provisions putting the onus of info management on companies, making it easier for the PCAOB to conduct on-site audits. It...

Travis Lundy

CSRC and PCAOB "Agree" On Audit Terms - Now PCAOB Will Try To Prove a Negative

The PCAOB and CSRC announced they had signed a Statement of Protocol which allows the PCAOB to move forward with testing whether there will be...

Travis Lundy

Index Rebalance & ETF Flow Recap: KWEB, CSI300/500, STAR50, SSE50, ChiNext, SET50, Chips, Denso, SPX

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

KWEB Index Rebalance: Fenbi (2469 HK) & YSB (9885 HK) Added

Fenbi and YSB will be bought by the KWEB ETF at the close on 8 December. Fenbi also has some passive inflows at month end. YSB has a big lock up...

Brian Freitas