Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Cross Asset Strategy

<ul>
<li>The local media have mentioned that nearly 200,000 people in Korea have invested in Terra (Luna) and TerraUSD.</li>
<li>The combined market caps of Luna and TerraUSD at their peaks were nearly $60 billion and nearly $57.4 billion has been wiped out in the past week.</li>
<li>Consequently, in the coming weeks there could be some domino effect of people in Korea that have borrowed money to invest in these risky cryptos selling other assets.</li>
</ul>


The local media have mentioned that nearly 200,000 people in Korea have invested in Terra (Luna) and TerraUSD.
The combined market caps of Luna and TerraUSD at their peaks were nearly $60 billion and nearly $57.4 billion has been wiped out in the past week.
Consequently, in the coming weeks there could be some domino effect of people in Korea that have borrowed money to invest in these risky cryptos selling other assets.


The Collapse of Luna - Big Negative Impact on 200k Investors In Korea

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>A noteworthy flow trend in the Korean stock market is the National Pension Service's local equity purchase. For this, they tend to overweight those previously underweighted blue-chip stocks. </li>
<li>All of the top 10 most net-bought stocks by local pensions on April 18-26 are KOSPI 200 constituents. And most of them all have a relatively small NPS-owned stake.</li>
<li>Most of them have significantly outperformed the KOSPI 200 (-0.90%) during this period.</li>
</ul>


A noteworthy flow trend in the Korean stock market is the National Pension Service's local equity purchase. For this, they tend to overweight those previously underweighted blue-chip stocks. 
All of the top 10 most net-bought stocks by local pensions on April 18-26 are KOSPI 200 constituents. And most of them all have a relatively small NPS-owned stake.
Most of them have significantly outperformed the KOSPI 200 (-0.90%) during this period.


Noteworthy Flow Trend: Korea NPS Overweighting Local Equity

Index Rebalance

<ul>
<li>FnGuide Samsung Group has the most AUM among locally themed indexes. As of last Friday's closing price, AUM is ₩1.52T.</li>
<li>The share price movements of Samsung Group affiliates basically show high cointegration. Therefore, a small differential impact on the flow significantly affects the short-term price direction of these stocks. </li>
<li>So, we should consider a long/short setup on a swing trading window. Particularly, we need to focus on the first two trading days, when the rebalancing impact is relatively significant.</li>
</ul>


FnGuide Samsung Group has the most AUM among locally themed indexes. As of last Friday's closing price, AUM is ₩1.52T.
The share price movements of Samsung Group affiliates basically show high cointegration. Therefore, a small differential impact on the flow significantly affects the short-term price direction of these stocks. 
So, we should consider a long/short setup on a swing trading window. Particularly, we need to focus on the first two trading days, when the rebalancing impact is relatively significant.


FnGuide Samsung Group Index Rebalancing Preview

Equity Bottom-Up

<ul>
<li>Lg Innotek (011070 KS), a leading global producer of optical electronic parts, has one of the most attractive fundamentals in Korea. </li>
<li>LG Innotek has become one of the critical suppliers for Apple's smartphones. For example, LG Innotek accounted for more than 70% of the camera modules used for Apple's iPhone 13.</li>
<li>In the intermediate term, LG Innotek is expected to benefit from higher demand for metaverse related cameras, 3D sensing modules, and autonomous vehicle cameras. </li>
</ul>


Lg Innotek (011070 KS), a leading global producer of optical electronic parts, has one of the most attractive fundamentals in Korea. 
LG Innotek has become one of the critical suppliers for Apple's smartphones. For example, LG Innotek accounted for more than 70% of the camera modules used for Apple's iPhone 13.
In the intermediate term, LG Innotek is expected to benefit from higher demand for metaverse related cameras, 3D sensing modules, and autonomous vehicle cameras. 


LG Innotek: One of the Most Attractive Fundamentals in the Korean Stock Market

Samsung Electronics Pref Shares / Event-Driven

<ul>
<li>
 Korean prefs have outperformed ords on a YTD basis, probably due to the LG Energy listing. Many of KOSPI's large-cap stocks have seen an outflow to make room for LGES.</li>
<li>
Samsung Electronics 1P and Mirae Asset 2PB have a negative pref-ord YTD yield difference and are currently below-1.0σ on a 20-day MA.</li>
<li>Mirae widened the pref-ord spread by announcing an ord-only share buyback. So it should be seen as an outlier. Then, virtually all that remains is the Samsung Electronics 1P.</li>
</ul>



 Korean prefs have outperformed ords on a YTD basis, probably due to the LG Energy listing. Many of KOSPI's large-cap stocks have seen an outflow to make room for LGES.

Samsung Electronics 1P and Mirae Asset 2PB have a negative pref-ord YTD yield difference and are currently below-1.0σ on a 20-day MA.
Mirae widened the pref-ord spread by announcing an ord-only share buyback. So it should be seen as an outlier. Then, virtually all that remains is the Samsung Electronics 1P.


Korea Large-Cap Prefs: Pref-Ord YTD Yield Difference & 20-Day MA Sigma

South Korea

Samsung Electro-Mechanics Co., Ltd. manufactures a variety of electronic components used in computers, audio and video products, industrial electronics, and telecommunication equipment. The Company's products include multi-layer boards and capacitors, optical Pick Ups, deflection yokes (DY), keyboards, speakers, and light emitting diode (LED) products.

Samsung Electro Mechanics Co, Ltd. (009150 KS)

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Samsung Electro Mechanics Co, Ltd. (009150 KS)

The Collapse of Luna - Big Negative Impact on 200k Investors In Korea

The local media have mentioned that nearly 200,000 people in Korea have invested in Terra (Luna) and TerraUSD. Their combined values have collapsed...

Douglas Kim

Noteworthy Flow Trend: Korea NPS Overweighting Local Equity

The NPS seems to have recently begun to overweight local equity, and this post investigates this significant flow trend and the stocks worthy of...

Sanghyun Park

FnGuide Samsung Group Index Rebalancing Preview

FnGuide Samsung Group Index has the largest AUM among the locally-themed indexes. This post previews the upcoming rebalancing in June.

Sanghyun Park

LG Innotek: One of the Most Attractive Fundamentals in the Korean Stock Market

Lg Innotek has a combination of relatively reasonable valuation multiples and excellent sales and profit growth rates. LG Innotek has become one of...

Douglas Kim

Korea Large-Cap Prefs: Pref-Ord YTD Yield Difference & 20-Day MA Sigma

This post examines Korea's large-cap preferred shares for their pref-ord YTD yield difference and sigma on a 20-day moving average.

Sanghyun Park

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