Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>Quiddity's "Who is Ready" series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.</li>
<li>There were no new TOPIX Inclusions announced since our last insight.</li>
<li>At present, there are many names capable of satisfying the current Prime Market Section Transfer Requirements. However, a new index methodology will become effective later this year.</li>
</ul>


Quiddity's "Who is Ready" series of insights aims to objectively identify names listed on the Tokyo Stock Exchange that are potential additions to the TOPIX Index in future.
There were no new TOPIX Inclusions announced since our last insight.
At present, there are many names capable of satisfying the current Prime Market Section Transfer Requirements. However, a new index methodology will become effective later this year.


TOPIX Inclusions: Who Is Ready (June 2026)

Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

<ul>
<li>The TOPIX Index - Japan's premier domestic equity index - will undergo a sea change in methodology at the end of this month, with ~760 names affected. </li>
<li>There will be roughly 35 or so ADDs, about 700 DELETEs (phased out over 8 quarters), and 40+ Liquidity Factor Removals. There will also be hundreds of FFW changes. </li>
<li>The likely ADDs have handily outperformed their peers over the past year, but some of that has been tech and idiosyncratic circumstances. There may still be trades to do.</li>
</ul>


The TOPIX Index - Japan's premier domestic equity index - will undergo a sea change in methodology at the end of this month, with ~760 names affected. 
There will be roughly 35 or so ADDs, about 700 DELETEs (phased out over 8 quarters), and 40+ Liquidity Factor Removals. There will also be hundreds of FFW changes. 
The likely ADDs have handily outperformed their peers over the past year, but some of that has been tech and idiosyncratic circumstances. There may still be trades to do.


[Quiddity Index] The TOPIX Change in Oct26 - Part V (Final Prep)

<ul>
<li>The TOPIX Index will see a sea change in methodology implemented in October 2026. The data cutoff for price is 31 August 2026. </li>
<li>That means there are two days and change left before the prices decide whether a stock gets in, stays in, gets deleted, or sees its Liquidity Factor removed. </li>
<li>At the borderlines, a move of a few percent either way in these last days may (assuming FFWs) swing the buy/sell by dozens of days of ADV.</li>
</ul>


The TOPIX Index will see a sea change in methodology implemented in October 2026. The data cutoff for price is 31 August 2026. 
That means there are two days and change left before the prices decide whether a stock gets in, stays in, gets deleted, or sees its Liquidity Factor removed. 
At the borderlines, a move of a few percent either way in these last days may (assuming FFWs) swing the buy/sell by dozens of days of ADV.


[Quiddity Index] The TOPIX Change in Oct26 - Part IV (Last Minute Jockeying)

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

TSE Tokyo Price Index TOPIX / Technical Analysis

<ul>
<li>The MSCI ACWI index ACWI-US briefly fell below major support at $90.50-$91.50, though we do not consider it a "decisive" breakdown and we now see a false breakdown (bullish).</li>
<li>On MSCI ACWI (local currency), a false breakdown appears to already be in place, which is bullish as long as the index does not break to a new low.</li>
<li>MSCI EM (EEM-US) continues to hold above $36.50-$37 support, while MSCI ACWI ex-US (ACWX-US) and EAFE (EFA-US) remain above supports at $45 and $65-$66, respectively. Pullback is likely over.</li>
</ul>


The MSCI ACWI index ACWI-US briefly fell below major support at $90.50-$91.50, though we do not consider it a "decisive" breakdown and we now see a false breakdown (bullish).
On MSCI ACWI (local currency), a false breakdown appears to already be in place, which is bullish as long as the index does not break to a new low.
MSCI EM (EEM-US) continues to hold above $36.50-$37 support, while MSCI ACWI ex-US (ACWX-US) and EAFE (EFA-US) remain above supports at $45 and $65-$66, respectively. Pullback is likely over.


Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over

<ul>
<li>Two+ years ago, the TSE announced a second phase methodology change for its main equity index TOPIX. TOPIX would change from being inclusive to being exclusive, resembling global indices. </li>
<li>The data cutoff for TOPIX methodology change rankings is 14bd away. That cutoff determines who gets in, who stays in, and who gets the boot. The annual FFW review coincides.</li>
<li>The BEST trades are the unrelated FFW trades, the INs, the LFRs, and of course, the NOT OUTs. Borderlines are interesting. Two stocks +2%? -4%?, +42/24x ADV. Or not. </li>
</ul>


Two+ years ago, the TSE announced a second phase methodology change for its main equity index TOPIX. TOPIX would change from being inclusive to being exclusive, resembling global indices. 
The data cutoff for TOPIX methodology change rankings is 14bd away. That cutoff determines who gets in, who stays in, and who gets the boot. The annual FFW review coincides.
The BEST trades are the unrelated FFW trades, the INs, the LFRs, and of course, the NOT OUTs. Borderlines are interesting. Two stocks +2%? -4%?, +42/24x ADV. Or not. 


[Quiddity Index] The TOPIX Change in Oct26 - Part III (INs Vs OUTs - Borderlines Are Trading Opps)

Japan

McDonald's Holdings Company (Japan), Ltd. operates a hamburger fast food restaurant chain throughout Japan.  The Company operates its own stores and franchise stores.

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Mcdonald's Japan (2702 JP)

TOPIX Inclusions: Who Is Ready (June 2026)

There are currently 149 names that satisfy all 5 key Segment Transfer requirements based on current data. Another 140 names can satisfy 4 out of 5...

Janaghan Jeyakumar, CFA

[Quiddity Index] The TOPIX Change in Oct26 - Part V (Final Prep)

The TSE announcement for wholesale changes in the TOPIX Index is scheduled for Wednesday after the close. I expect 34-35 ADDs, ~700 DELETEs, and...

Travis Lundy

[Quiddity Index] The TOPIX Change in Oct26 - Part IV (Last Minute Jockeying)

The TOPIXOct 2026 Rebal is big and exciting. It is most exciting in the smallcaps in the $300-450mm range where the borders are for selection...

Travis Lundy

Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over

The MSCI $ACWI briefly fell below our $90.50 support but quickly reclaimed, suggesting a false breakdown and the likely end to this pullback in...

Vermilion Research

[Quiddity Index] The TOPIX Change in Oct26 - Part III (INs Vs OUTs - Borderlines Are Trading Opps)

The TOPIX Rebal is interesting. One pricing date, on a long flat tail of rankings, to determine whether to buy or sell 5-40x ADV. That kicks up...

Travis Lundy

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52-week Range

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TOPIX Inclusions: Who Is Ready (June 2026)

There are currently 149 names that satisfy all 5 key Segment Transfer requirements based on current data. Another 140 names can satisfy 4 out of 5...

Janaghan Jeyakumar, CFA

[Quiddity Index] The TOPIX Change in Oct26 - Part V (Final Prep)

The TSE announcement for wholesale changes in the TOPIX Index is scheduled for Wednesday after the close. I expect 34-35 ADDs, ~700 DELETEs, and...

Travis Lundy

[Quiddity Index] The TOPIX Change in Oct26 - Part IV (Last Minute Jockeying)

The TOPIXOct 2026 Rebal is big and exciting. It is most exciting in the smallcaps in the $300-450mm range where the borders are for selection...

Travis Lundy

Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over

​The MSCI $ACWI briefly fell below our $90.50 support but quickly reclaimed, suggesting a false breakdown and the likely end to this pullback in...

Vermilion Research

[Quiddity Index] The TOPIX Change in Oct26 - Part III (INs Vs OUTs - Borderlines Are Trading Opps)

The TOPIX Rebal is interesting. One pricing date, on a long flat tail of rankings, to determine whether to buy or sell 5-40x ADV. That kicks up...

Travis Lundy

The MSCI $ACWI briefly fell below our $90.50 support but quickly reclaimed, suggesting a false breakdown and the likely end to this pullback in...