Index Rebal Trades & Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal Trades & Special Situations

Quiddity Advisors

Pan-Asia Catalysts/Events

Index Rebalance

<ul>
<li>The December 2024 index review results for the CSI Medical Service Index were announced after market close on Friday 29th November 2024.</li>
<li>There will be 3 changes for the CSI Medical Service index.</li>
<li>We predicted all the changes correctly but we expected a couple of extra changes which did not materialize.</li>
</ul>


The December 2024 index review results for the CSI Medical Service Index were announced after market close on Friday 29th November 2024.
There will be 3 changes for the CSI Medical Service index.
We predicted all the changes correctly but we expected a couple of extra changes which did not materialize.


Quiddity CSI Medical Dec 24 Results: 3 Changes; All Expected; US$362mn One-Way

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

<ul>
<li>The review period ended on 31 October, the changes should be announced on 29 November and will become effective after the close of trading on 13 December.</li>
<li>We forecast 4 potential changes for the index in December. Estimated one-way turnover is 5.2% resulting in a round-trip trade of CNY 3.3bn (US$460m).</li>
<li>The forecast adds have continued to underperform the forecast deletes over the last few months as markets have rallied. That could change as positioning builds up ahead of announcement.</li>
</ul>


The review period ended on 31 October, the changes should be announced on 29 November and will become effective after the close of trading on 13 December.
We forecast 4 potential changes for the index in December. Estimated one-way turnover is 5.2% resulting in a round-trip trade of CNY 3.3bn (US$460m).
The forecast adds have continued to underperform the forecast deletes over the last few months as markets have rallied. That could change as positioning builds up ahead of announcement.


CSI Medical Service Index Rebalance Preview: Needs Resuscitation

HK/China Healthcare Analyst (ex-Fosun Pharma)

Xinyao (Criss) Wang

Thematic (Sector/Industry)

<ul>
<li>Although DeepSeek's continuous updates, iterations, and deep integration with more and more healthcare enterprises in China will bring positive market sentiment, we have seen certain limitations and even risks behind.</li>
<li>Currently, AI healthcare relies heavily on government subsidies or hardware sales in China, which lacks sustainable payment scenarios and profit model. The data security/privacy/compliance issue may not be completely solve.</li>
<li>For the companies that have integrated with DeepSeek, investors need to verify their afterwards financial performance and fundamentals. If it does not meet expectations, investors are recommended sell in time.</li>
</ul>


Although DeepSeek's continuous updates, iterations, and deep integration with more and more healthcare enterprises in China will bring positive market sentiment, we have seen certain limitations and even risks behind.
Currently, AI healthcare relies heavily on government subsidies or hardware sales in China, which lacks sustainable payment scenarios and profit model. The data security/privacy/compliance issue may not be completely solve.
For the companies that have integrated with DeepSeek, investors need to verify their afterwards financial performance and fundamentals. If it does not meet expectations, investors are recommended sell in time.


DeekSeek May Not Be The "Game Changer" In China Healthcare - Time to Be Rational

<ul>
<li>DeepSeek, as a domestically produced open-source model in China, combined with the rapid development of AI technology, is profoundly changing the landscape of pharmaceutical and medical industry.</li>
<li>AI pharmaceuticals/AI diagnosis/AI R&amp;D would benefit the most from DeepSeek. However, data security is an issue. The US has enacted legislation to restrict cooperation with Chinese companies due to DeepSeek.</li>
<li>More and more Chinese companies have announced their integration into DeepSeek, involving multiple subsectors. We listed some representative companies and they will become attractive investment targets for investors.</li>
</ul>


DeepSeek, as a domestically produced open-source model in China, combined with the rapid development of AI technology, is profoundly changing the landscape of pharmaceutical and medical industry.
AI pharmaceuticals/AI diagnosis/AI R&amp;D would benefit the most from DeepSeek. However, data security is an issue. The US has enacted legislation to restrict cooperation with Chinese companies due to DeepSeek.
More and more Chinese companies have announced their integration into DeepSeek, involving multiple subsectors. We listed some representative companies and they will become attractive investment targets for investors.


DeepSeek Ignites China Healthcare - The Investment Opportunities and Risks Behind

Inner Mongolia Furui Medical Scie / Index Rebalance

<ul>
<li>CSI announced the changes for the December rebalance after market close on 29 November and the changes will be effective after the close of trading on 13 December.</li>
<li>There are 3 changes for the index and we estimate passive buying of 0.7-1.4x ADV in the adds and selling of between 0.2-1x ADV in the deletes.</li>
<li>Trade performance has been horrible as the adds have moved sideways over the last two months and the deletes have skyrocketed - that could change in the next two weeks.</li>
</ul>


CSI announced the changes for the December rebalance after market close on 29 November and the changes will be effective after the close of trading on 13 December.
There are 3 changes for the index and we estimate passive buying of 0.7-1.4x ADV in the adds and selling of between 0.2-1x ADV in the deletes.
Trade performance has been horrible as the adds have moved sideways over the last two months and the deletes have skyrocketed - that could change in the next two weeks.


CSI Medical Service Index Rebalance: Three Changes; Brutal Underperformance Could Reverse

China

Sansure Biotech Inc. operates as an in vitro diagnostic solution provider. The Company develops and sells upstream nucleic acid extraction kits, novel coronavirus nucleic acid detection kits, and other products. Sansure Biotech markets its products worldwide.

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Sansure Biotech (688289 CH)

Quiddity CSI Medical Dec 24 Results: 3 Changes; All Expected; US$362mn One-Way

We estimate one-way flow to be US$362mn. The Inclusion/Exclusion events will take place at the close of trading on 13th December 2024.

Janaghan Jeyakumar, CFA

CSI Medical Service Index Rebalance Preview: Needs Resuscitation

We forecast 4 changes for the index in Dec. Estimated 1-way turnover is 5.2% resulting in a round-trip trade of CNY 3.3bn (US$460m). The adds have...

Brian Freitas

DeekSeek May Not Be The "Game Changer" In China Healthcare - Time to Be Rational

DeepSeek's integration with companies brings market optimism, but risks remain due to unsustainable profit model and data security...

Xinyao (Criss) Wang

DeepSeek Ignites China Healthcare - The Investment Opportunities and Risks Behind

DeepSeek is revolutionizing the healthcare industry, but face data security issue and US restriction on cooperation with China.Companies...

Xinyao (Criss) Wang

CSI Medical Service Index Rebalance: Three Changes; Brutal Underperformance Could Reverse

There are 3 changes for the index in December. The adds have underperformed the deletes over the last 2 months. Going by historical performance,...

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Quiddity CSI Medical Dec 24 Results: 3 Changes; All Expected; US$362mn One-Way

We estimate one-way flow to be US$362mn. The Inclusion/Exclusion events will take place at the close of trading on 13th December 2024.

Janaghan Jeyakumar, CFA

CSI Medical Service Index Rebalance Preview: Needs Resuscitation

We forecast 4 changes for the index in Dec. Estimated 1-way turnover is 5.2% resulting in a round-trip trade of CNY 3.3bn (US$460m). The adds have...

Brian Freitas

DeekSeek May Not Be The "Game Changer" In China Healthcare - Time to Be Rational

​DeepSeek's integration with companies brings market optimism, but risks remain due to unsustainable profit model and data security...

Xinyao (Criss) Wang

DeepSeek Ignites China Healthcare - The Investment Opportunities and Risks Behind

DeepSeek is revolutionizing the healthcare industry, but face data security issue and US restriction on cooperation with China.Companies...

Xinyao (Criss) Wang

CSI Medical Service Index Rebalance: Three Changes; Brutal Underperformance Could Reverse

There are 3 changes for the index in December. The adds have underperformed the deletes over the last 2 months. Going by historical performance,...

Brian Freitas

DeepSeek's integration with companies brings market optimism, but risks remain due to unsustainable profit model and data security...