Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

<ul>
<li>The TSE announced its first large FFW rebalance under new rules and Market Segmentation. ~1,000 names see FFW drop 5% or more. 100+ rise 5+%. Reverse funding trades are significant.</li>
<li>Top BUY flow: Toyota, Olympus, Daiichi Sankyo, Tokio Marine, JP Holdings with an average of 4.0 days' ADV to buy. Softbank/9984, MitCorp, Hitachi, Suzuki, Marubeni average 4.8 days to SELL.</li>
<li>493 names start their phased weight reduction out of TOPIX because they do not meet the hurdle for minimum trading value. And... Shinsei is the most impressive SELL name.
</li>
</ul>


The TSE announced its first large FFW rebalance under new rules and Market Segmentation. ~1,000 names see FFW drop 5% or more. 100+ rise 5+%. Reverse funding trades are significant.
Top BUY flow: Toyota, Olympus, Daiichi Sankyo, Tokio Marine, JP Holdings with an average of 4.0 days' ADV to buy. Softbank/9984, MitCorp, Hitachi, Suzuki, Marubeni average 4.8 days to SELL.
493 names start their phased weight reduction out of TOPIX because they do not meet the hurdle for minimum trading value. And... Shinsei is the most impressive SELL name.



TOPIX October 2022 Rebal - BIG Names with BIG Flows

<ul>
<li>
<a href="https://www.smartkarma.com/entities/sbi-holdings-inc" target="_blank" data-smartkarma-citation="entities:10928:1" rel="noopener">SBI Holdings (8473 JP)</a>'s subsidiary has <a href="https://www3.nhk.or.jp/news/html/20220930/k10013843881000.html" target="_blank" rel="noopener">reportedly</a> filed its application to become a Bank Holding Company, the definition being a company holding a 50% or greater stake in a bank.</li>
<li>The day after I last wrote, Shinsei <a href="https://www.shinseibank.com/corporate/en/news/pdf/pdf2022/221003_corporatenameLP_e.pdf" target="_blank" rel="noopener">announced</a> it had received approval to change its name to SBI Shinsei Bank as of 4 January 2023.</li>
<li>My expectation is the move above 50% happens sooner rather than later. And in that case, investors should think about their approach. Get your cowbells ready.</li>
</ul>



SBI Holdings (8473 JP)'s subsidiary has reportedly filed its application to become a Bank Holding Company, the definition being a company holding a 50% or greater stake in a bank.
The day after I last wrote, Shinsei announced it had received approval to change its name to SBI Shinsei Bank as of 4 January 2023.
My expectation is the move above 50% happens sooner rather than later. And in that case, investors should think about their approach. Get your cowbells ready.


Thinking Strategically About a Shinsei Position - Things To Do NOW

<ul>
<li>Last Friday most of the way through the afternoon session, media reports ran a story saying <a href="https://www.smartkarma.com/entities/sbi-holdings-inc" target="_blank" data-smartkarma-citation="entities:10928:1" rel="noopener">SBI Holdings (8473 JP)</a> had applied for a Bank Holding Company authorisation. </li>
<li>That is a filing with the FSA one makes when one wants to acquire &gt;50% of voting rights in an entity with a Banking license. Shares popped, and fell back. </li>
<li>They probably didn't pop enough. There is a BIG sell flow coming, but the timing is giri-giri on eventiness, and confident traders could take the whole trade.</li>
</ul>


Last Friday most of the way through the afternoon session, media reports ran a story saying SBI Holdings (8473 JP) had applied for a Bank Holding Company authorisation. 
That is a filing with the FSA one makes when one wants to acquire &gt;50% of voting rights in an entity with a Banking license. Shares popped, and fell back. 
They probably didn't pop enough. There is a BIG sell flow coming, but the timing is giri-giri on eventiness, and confident traders could take the whole trade.


SBI Applies for Bank Holdco License for Shinsei Stake. Aims to Go Above 50%. It's Coming.

Index Rebal/Special Situations, Quiddity Advisors

Janaghan Jeyakumar, CFA

Index Rebal/Special Situations

<ul>
<li>JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.</li>
<li>A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.</li>
<li>Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2023 based on trading data as of end-September 2022.</li>
</ul>


JPX-Nikkei 400 is composed of common stocks listed on the Tokyo Stock Exchange. It is a free-float-adjusted market-value-weighted (capped) index composed of 400 constituents.
A periodic review is conducted by the Index providers, the JPX Group and Nikkei Inc, in August every year. We look at the potential forward inclusions and removals every month.
Below is a look at potential Inclusions and Removals for the JPX-Nikkei 400 Rebalance to come in August 2023 based on trading data as of end-September 2022.


<ul>
<li>This is a hybrid insight on the upcoming TOPIX FFW Review to be announced 7 October, and the situation around <a href="https://www.smartkarma.com/entities/shinsei-bank-ltd" target="_blank" data-smartkarma-citation="entities:16897:1" rel="noopener">Shinsei Bank (8303 JP)</a>. </li>
<li>Shinsei Bank is in "limbo" post control-acquisition by <a href="https://www.smartkarma.com/entities/sbi-holdings-inc" target="_blank" data-smartkarma-citation="entities:10928:1" rel="noopener">SBI Holdings (8473 JP)</a> and an attempt to go over 50% should be in the works. When is not known.</li>
<li>The TOPIX FFW Review should see ¥2.0-2.2trln of one-way flow, and amongst that flow, a large sell on Shinsei to increase Real World Float by 60+% and 25d of ADV.</li>
</ul>


This is a hybrid insight on the upcoming TOPIX FFW Review to be announced 7 October, and the situation around Shinsei Bank (8303 JP). 
Shinsei Bank is in "limbo" post control-acquisition by SBI Holdings (8473 JP) and an attempt to go over 50% should be in the works. When is not known.
The TOPIX FFW Review should see ¥2.0-2.2trln of one-way flow, and amongst that flow, a large sell on Shinsei to increase Real World Float by 60+% and 25d of ADV.


The October TOPIX FFW Review and Shinsei Bank (8303)'s Future Float

Japan

SBI Holdings, Inc. manages venture capital fund which mainly invest in Internet related venture companies.  The Company also provides brokerage, investment banking, and financial services.

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SBI Holdings (8473 JP)

TOPIX October 2022 Rebal - BIG Names with BIG Flows

The annual TOPIX FFW rebalance is larger this year than normal, with the twist that 493 names will now start to be phased out completely.

Travis Lundy

Thinking Strategically About a Shinsei Position - Things To Do NOW

Shinsei Bank may be in its last throes of independence. Shareholders usually do not get the chance to pester the Board before a price is...

Travis Lundy

SBI Applies for Bank Holdco License for Shinsei Stake. Aims to Go Above 50%. It's Coming.

SBI has applied for the ability go above 50% in Shinsei. They should get approval in a month, around the time of the huge TOPIX selldown. This...

Travis Lundy

JPX-Nikkei 400 Rebal 2023: End-Sep 2022

The HIGH AND MED conviction groups of Potential ADDs could outperform the HIGH AND MED conviction groups of Potential DELs in the next few weeks.

Janaghan Jeyakumar, CFA

The October TOPIX FFW Review and Shinsei Bank (8303)'s Future Float

HYBRID INSIGHT: Shinsei and the October TOPIX FFW Review. Shinsei is now somewhat cheap to largercap peers, but will see 25 days of volume to sell...

Travis Lundy

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