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

<ul>
<li>The local street hears KRX has bumped it up to 14.68%. With the 1% rounding applied, it becomes 15%.</li>
<li>It is extremely rare for a Fast Entry to come in with a float market cap of +₩10T. So, we will see significant weight adjustments for the other constituents.</li>
<li>As we move towards the implementation date, we can consider basket-shorting those high-impact names for LG Energy's long hedge.</li>
</ul>


The local street hears KRX has bumped it up to 14.68%. With the 1% rounding applied, it becomes 15%.
It is extremely rare for a Fast Entry to come in with a float market cap of +₩10T. So, we will see significant weight adjustments for the other constituents.
As we move towards the implementation date, we can consider basket-shorting those high-impact names for LG Energy's long hedge.


LG Energy's KOSPI 200 Float Is 15%: Weight Adjustment Trading for Other Constituents

<ul>
<li>LG Energy's KOSPI 200 Fast Entry review period ended this Monday, and KRX immediately announced LG Energy's Fast Entry to KOSPI 200. Dongwon F&amp;B leaves the Index for LG Energy.</li>
<li>LG Energy's passive inflow is ₩202.2B at the close on March 10, 0.66x ADTV. On the other hand, Dongwon F&amp;B's passive outflow is ₩4.0B, representing 5.84x ADTV.</li>
<li>LG Energy's impact size is large enough to affect the price right before the implementation. In particular, since K-New Deal rebalancing occurs after March 10, the effect can be aggravated.</li>
</ul>


LG Energy's KOSPI 200 Fast Entry review period ended this Monday, and KRX immediately announced LG Energy's Fast Entry to KOSPI 200. Dongwon F&amp;B leaves the Index for LG Energy.
LG Energy's passive inflow is ₩202.2B at the close on March 10, 0.66x ADTV. On the other hand, Dongwon F&amp;B's passive outflow is ₩4.0B, representing 5.84x ADTV.
LG Energy's impact size is large enough to affect the price right before the implementation. In particular, since K-New Deal rebalancing occurs after March 10, the effect can be aggravated.


LG Energy KOSPI 200 Fast Entry: Passive Impact on March 10

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>On 22 February, the KRX announced that LG Energy Solution (373220 KS) will be included in numerous local indices including KOSPI 200, KOSPI 100, and KRX 100 effective 3/11/2022.</li>
<li>This has been widely expected by the market. Due to the inclusion in KOSPI 200, investors will be able to short LG Energy Solution starting 11 March. </li>
<li>Once Dongwon F&amp;B is excluded from the KOSPI 200 index, this could be a key buying opportunity on this stock, given the company's solid fundamentals. </li>
</ul>


On 22 February, the KRX announced that LG Energy Solution (373220 KS) will be included in numerous local indices including KOSPI 200, KOSPI 100, and KRX 100 effective 3/11/2022.
This has been widely expected by the market. Due to the inclusion in KOSPI 200, investors will be able to short LG Energy Solution starting 11 March. 
Once Dongwon F&amp;B is excluded from the KOSPI 200 index, this could be a key buying opportunity on this stock, given the company's solid fundamentals. 


KOSPI 200: LG Energy Solution Inclusion and Dongwon F&B Exclusion

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

<ul>
<li>KRX has announced the Fast Entry inclusion of <a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (373220 KS)</a> in the KOSPI200 Index at the close on 10 March. <a href="https://www.smartkarma.com/entities/dongwon-f-b-co-ltd" target="_blank" data-smartkarma-citation="entities:3274:1" rel="noopener">Dongwon F&amp;B (049770 KS)</a> will be deleted.</li>
<li>
<a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (373220 KS)</a>'s inclusion in the KRX Secondary Battery Index and the BBIG Index should be announced in the next few days. That will add to passive buying.</li>
<li>Local institutions have been buyers on <a href="https://www.smartkarma.com/entities/lg-energy-solution" target="_blank" data-smartkarma-citation="entities:33464:1" rel="noopener">LG Energy Solution (373220 KS)</a> since listing while retail and foreign investors have been sellers. There is a biggish lock up expiry coming up.</li>
</ul>


KRX has announced the Fast Entry inclusion of LG Energy Solution (373220 KS) in the KOSPI200 Index at the close on 10 March. Dongwon F&amp;B (049770 KS) will be deleted.

LG Energy Solution (373220 KS)'s inclusion in the KRX Secondary Battery Index and the BBIG Index should be announced in the next few days. That will add to passive buying.
Local institutions have been buyers on LG Energy Solution (373220 KS) since listing while retail and foreign investors have been sellers. There is a biggish lock up expiry coming up.


KOSPI200 Index Rebalance (March): LG Energy IN; Dongwon F&B Out

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<ul>
<li>
<strong><a href="https://www.smartkarma.com/entities/sk-square-co-ltd" target="_blank" data-smartkarma-citation="entities:35264:1" rel="noopener">SK Square (402340 KS)</a></strong> was inexpensive after its November listing. Now it's even cheaper. </li>
<li>Preceding my comments on SK Square - and <strong><a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a></strong> - are the current setup/unwind tables for Asia-Pacific Holdcos. </li>
<li>These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.</li>
</ul>



SK Square (402340 KS) was inexpensive after its November listing. Now it's even cheaper. 
Preceding my comments on SK Square - and LG Chem Ltd (051910 KS) - are the current setup/unwind tables for Asia-Pacific Holdcos. 
These relationships trade with a minimum liquidity of US$1mn, and a % market capitalisation &gt;20%.


StubWorld: SK Square And LG Chem's Unjustified NAV Discounts

South Korea

LG Energy Solution produces and sells batteries. The Company manufactures and sells automobile batteries, small batteries, energy storage system batteries, and other products. LG Energy Solution markets its products worldwide.

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LG Energy Solution (373220 KS)

LG Energy's KOSPI 200 Float Is 15%: Weight Adjustment Trading for Other Constituents

KRX has bumped up LG Energy's float to 15%. As a result, we will see a more substantial passive impact on LG Energy. Also, we should see...

Sanghyun Park

LG Energy KOSPI 200 Fast Entry: Passive Impact on March 10

KRX announced LG Energy's Fast Entry to KOSPI 200. Dongwon F&B leaves the Index. The passive impact on the implementation date, combined with K-New...

Sanghyun Park

KOSPI 200: LG Energy Solution Inclusion and Dongwon F&B Exclusion

On 22 February, the KRX announced that LG Energy Solution (373220 KS) will be included in numerous local indices including KOSPI 200, KOSPI 100,...

Douglas Kim

KOSPI200 Index Rebalance (March): LG Energy IN; Dongwon F&B Out

LG Energy will be added to the KOSPI200 Index at the close on 10 March, while Dongwon F&B will be deleted. There will be a large KOSPI200 basket...

Brian Freitas

StubWorld: SK Square And LG Chem's Unjustified NAV Discounts

Wide discounts in Korea are not uncommon. But SK Square has a strong parent/sub relationship. The holding in Hynix is worth 243% and 72% of SK...

David Blennerhassett

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