Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

MSCI Emerging Markets Index / Technical Analysis

China (MSCI China) continues to offer many attractive setups and accounts for the vast majority of today’s recommendations. Taiwan (TAIEX) continues to be worthy of an overweight within the EM universe, while Brazil (Bovespa) and India (SENSEX) display improving price and RS trends -

China (MSCI China) continues to offer many attractive setups and accounts for the vast majority of today’s recommendations. Taiwan (TAIEX) continues to be worthy of an overweight within the EM universe, while Brazil (Bovespa) and India (SENSEX) display improving price and RS trends -

US Dollar Weakness Remains A Tailwind For EM

We continue to be encouraged by market dynamics that are supportive of an ongoing equity bull market. Additionally, there continues to be an absence of breakdowns on the major global indexes (MSCI ACWI, ACWI ex-US, EM, &amp; EAFE). As a result, our outlook remains bullish.  In this report we show some love to various Sectors that have not been big attention-grabbers for us in recent months, but still have plenty of attractive stocks. The stocks highlighted hail from a variety of countries. Sectors covered include Services, Communications, Staples, Financials, and Utilities.

We continue to be encouraged by market dynamics that are supportive of an ongoing equity bull market. Additionally, there continues to be an absence of breakdowns on the major global indexes (MSCI ACWI, ACWI ex-US, EM, &amp; EAFE). As a result, our outlook remains bullish.  In this report we show some love to various Sectors that have not been big attention-grabbers for us in recent months, but still have plenty of attractive stocks. The stocks highlighted hail from a variety of countries. Sectors covered include Services, Communications, Staples, Financials, and Utilities.

Global Equity Strategy: Market Dynamics Remain Positive, And So Are We

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

With more than half of the double festival holidays of China have now passed, we took an on-the-ground check for the business in the Golden Week. A walk along the Nanjing Road Pedestrian Walk in Shanghai with visits to various retail stores showed that consumption has witnessed a good, but not yet full, recovery.
We stopped by mobile phone, sportswear, jewellery and high-end luxury stores, and saw that mobile phone stores are witnessing the best customer patronage. Based on our visits, we observed that: 1.) Apple store (<a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple Inc (AAPL US)</a>) is doing better than Huawei, 2.) Nike and Adidas (<a href="https://www.smartkarma.com/entities/topsports-international" target="_blank" data-smartkarma-citation="entities:28153:1" rel="noopener">Topsports International (6110 HK)</a>) &gt; FILA (<a href="https://www.smartkarma.com/entities/anta-sports-products-ltd" target="_blank" data-smartkarma-citation="entities:10261:1" rel="noopener">Anta Sports Products (2020 HK)</a>) and <a href="https://www.smartkarma.com/entities/li-ning-co-ltd" target="_blank" data-smartkarma-citation="entities:6047:1" rel="noopener">Li Ning Co Ltd (2331 HK)</a>, 3.) <a href="https://www.smartkarma.com/entities/chow-tai-fook-jewellery-group" target="_blank" data-smartkarma-citation="entities:549:1" rel="noopener">Chow Tai Fook Jewellery (1929 HK)</a> &gt; Lao Miao (<a href="https://www.smartkarma.com/entities/fosun-international-ltd" target="_blank" data-smartkarma-citation="entities:433:1" rel="noopener">Fosun International (656 HK)</a>) and 4.) high-end luxury goods are in good demand, and this is positive to <a href="https://www.smartkarma.com/entities/hang-lung-properties-ltd" target="_blank" data-smartkarma-citation="entities:49:1" rel="noopener">Hang Lung Properties (101 HK)</a> and <a href="https://www.smartkarma.com/entities/china-tourism-group-duty-free-corp-ltd" target="_blank" data-smartkarma-citation="entities:12278:1" rel="noopener">China Tourism Group Duty Free Corp Ltd (601888 CH)</a>. Read on for pictures and more details.

With more than half of the double festival holidays of China have now passed, we took an on-the-ground check for the business in the Golden Week. A walk along the Nanjing Road Pedestrian Walk in Shanghai with visits to various retail stores showed that consumption has witnessed a good, but not yet full, recovery.
We stopped by mobile phone, sportswear, jewellery and high-end luxury stores, and saw that mobile phone stores are witnessing the best customer patronage. Based on our visits, we observed that: 1.) Apple store (Apple Inc (AAPL US)) is doing better than Huawei, 2.) Nike and Adidas (Topsports International (6110 HK)) &gt; FILA (Anta Sports Products (2020 HK)) and Li Ning Co Ltd (2331 HK), 3.) Chow Tai Fook Jewellery (1929 HK) &gt; Lao Miao (Fosun International (656 HK)) and 4.) high-end luxury goods are in good demand, and this is positive to Hang Lung Properties (101 HK) and China Tourism Group Duty Free Corp Ltd (601888 CH). Read on for pictures and more details.

China on the Ground: Hey, How's Your Golden Week?

Key $70 support on the MSCI ACWI (ACWI-US) held strong last week, and ACWI-US is now inflecting topside its bullish falling wedge pattern. This bullish price action combined with market dynamics which remain mostly healthy lead us to believe the lows of this recent correction are in. Consumer Discretionary and Manufacturing Sectors continue to be two attractive Sectors that are outperforming globally; we highlight numerous actionable names in today's report.

Key $70 support on the MSCI ACWI (ACWI-US) held strong last week, and ACWI-US is now inflecting topside its bullish falling wedge pattern. This bullish price action combined with market dynamics which remain mostly healthy lead us to believe the lows of this recent correction are in. Consumer Discretionary and Manufacturing Sectors continue to be two attractive Sectors that are outperforming globally; we highlight numerous actionable names in today's report.

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Equity Bottom-Up

<ul>
<li>Meituan Dianping ownership surges among Asia Ex-Japan active funds.</li>
<li>Average holding weights have since risen to 0.99%, with 32.7% of funds invested. </li>
<li>MSCI inclusion has driven weights higher, but active managers find themselves well short of the benchmark MSCI Asia Ex-Japan index level, on average. </li>
<li>Meituan has now become a key underweight holding for the majority of Asia Ex-Japan managers, exacerbated by the ongoing outperformance in 2020.</li>
</ul>


Meituan Dianping ownership surges among Asia Ex-Japan active funds.
Average holding weights have since risen to 0.99%, with 32.7% of funds invested. 
MSCI inclusion has driven weights higher, but active managers find themselves well short of the benchmark MSCI Asia Ex-Japan index level, on average. 
Meituan has now become a key underweight holding for the majority of Asia Ex-Japan managers, exacerbated by the ongoing outperformance in 2020.


Meituan Dianping:  From Nowhere to Key Underweight

China

Li Ning Company Limited researches, designs, manufactures, distributes, and retails sports footwear, apparel and accessories for sport and leisure use.

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Li Ning (2331 HK)

US Dollar Weakness Remains A Tailwind For EM

China accounts for the vast majority of today’s recommendations. Taiwan (TAIEX) continues to be worthy of an overweight within EM, while Brazil...

Vermilion Research

Global Equity Strategy: Market Dynamics Remain Positive, And So Are We

We show some love to various Sectors that have not been big attention-grabbers for us in recent months, including Services, Communications,...

Vermilion Research

China on the Ground: Hey, How's Your Golden Week?

With more than

Osbert Tang, CFA

Global Equity Strategy:

Key $70 support on the MSCI ACWI (ACWI-US) held strong last week, and ACWI-US is now inflecting topside its bullish falling wedge pattern. This...

Vermilion Research

Meituan Dianping: From Nowhere to Key Underweight

Meituan Dianping ownership among Asia Ex-Japan investors has surged since its addition to the MSCI indices earlier this year. After a less than...

Steven Holden

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