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 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

KraneShares CSI China Internet ETF / Index Rebalance

<ul>
<li>Nearly US$140bn has flowed into mainland China listed ETFs year to date and there have been big creations in the last few weeks as stocks have surged.</li>
<li>97% of all inflows are in ETFs benchmarked to the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI300</a>, CSI1000, <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI500</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>, <a href="https://www.smartkarma.com/entities/chinext-index" target="_blank" data-smartkarma-citation="entities:25483:1" rel="noopener">ChiNext</a> and <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> indices. But over US$4bn has gone into other ETFs in the last week.</li>
<li>The large ETF inflows over the last few weeks has led to index rebalance strategies underperforming in China. But that should reverse from now to rebalance implementation.</li>
</ul>


Nearly US$140bn has flowed into mainland China listed ETFs year to date and there have been big creations in the last few weeks as stocks have surged.
97% of all inflows are in ETFs benchmarked to the CSI300, CSI1000, CSI500, SSE50, ChiNext and STAR50 indices. But over US$4bn has gone into other ETFs in the last week.
The large ETF inflows over the last few weeks has led to index rebalance strategies underperforming in China. But that should reverse from now to rebalance implementation.


China ETF Inflows & Implications: YTD Inflows Nearing US$150bn

<ul>
<li>US markets suffered a bearish reversal on CPI data. Time look to elsewhere?</li>
<li>China looks to be bottoming. Could the region begin to show relative strength?</li>
<li>Emerging markets look particularly attractive especially if the dollar trades lower.</li>
</ul>


US markets suffered a bearish reversal on CPI data. Time look to elsewhere?
China looks to be bottoming. Could the region begin to show relative strength?
Emerging markets look particularly attractive especially if the dollar trades lower.


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

Rikki Malik

Cross Asset Strategy

<ul>
<li>A review of recent events/data impacting our investment themes or outlook</li>
<li>The narrative change around US tech spending on AI has potentially positive implications for Chinese technology shares</li>
<li>India sets the stage for interest rate cuts and the budget cuts taxes for the middle classes to boost consumption </li>
</ul>


A review of recent events/data impacting our investment themes or outlook
The narrative change around US tech spending on AI has potentially positive implications for Chinese technology shares
India sets the stage for interest rate cuts and the budget cuts taxes for the middle classes to boost consumption 


Overview #14 - The Emperor Has No Clothes Moment

<ul>
<li>It has been a decent year for the index rebalance strategy, though there have been some big hiccups along the way.</li>
<li>Forecasting the index changes and impacts has been important, but timing (especially momentum/value regime changes) and hedge selection have also been major factors affecting the returns of the strategy.</li>
<li>As passive AUM continues to increase, we expect focus on the strategy to continue in 2025 with market players taking different approaches to trading the potential and announced index changes.</li>
</ul>


It has been a decent year for the index rebalance strategy, though there have been some big hiccups along the way.
Forecasting the index changes and impacts has been important, but timing (especially momentum/value regime changes) and hedge selection have also been major factors affecting the returns of the strategy.
As passive AUM continues to increase, we expect focus on the strategy to continue in 2025 with market players taking different approaches to trading the potential and announced index changes.


How Has the Index Rebalance Strategy Performed in 2024?

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)

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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

China ETF Inflows & Implications: YTD Inflows Nearing US$150bn

Nearly US$150bn has flowed into mainland China ETFs year to date. 97% of that has gone into ETFs tracking headline indices, but there has been...

Brian Freitas

Time To Look Abroad?

US markets are bearish due to CPI data, prompting investors to consider shifting focus to China and emerging markets for potential relative...

Douglas Busch

Overview #14 - The Emperor Has No Clothes Moment

A review of recent events/data impacting our investment themes and outlook. We look at the potential implications of Deepseek on Chinese tech...

Rikki Malik

How Has the Index Rebalance Strategy Performed in 2024?

The index rebalance strategy has performed reasonably well this year. Accurate forecasting of index changes and optimal hedge selection have played...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

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

China ETF Inflows & Implications: YTD Inflows Nearing US$150bn

Nearly US$150bn has flowed into mainland China ETFs year to date. 97% of that has gone into ETFs tracking headline indices, but there has been...

Brian Freitas

Time To Look Abroad?

​US markets are bearish due to CPI data, prompting investors to consider shifting focus to China and emerging markets for potential relative...

Douglas Busch

Overview #14 - The Emperor Has No Clothes Moment

A review of recent events/data impacting our investment themes and outlook. We look at the potential implications of Deepseek on Chinese tech...

Rikki Malik

How Has the Index Rebalance Strategy Performed in 2024?

The index rebalance strategy has performed reasonably well this year. Accurate forecasting of index changes and optimal hedge selection have played...

Brian Freitas

US markets are bearish due to CPI data, prompting investors to consider shifting focus to China and emerging markets for potential relative...