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>Key issue is Citi’s day one public pool sizing. No local intel on the daily cap yet, but expect a tightly controlled, gradual opening over the first 3-6 months.</li>
<li>Likely shifting from FCFS to pro rata allocation, with Citi aggregating daily demand, setting a cutoff, and allocating capacity within the daily cap.</li>
<li>Quota hunting could drive intraday distortions, with failed ADR allocations triggering late day unwinds and adding volatility to Hynix local shares after July 29.</li>
</ul>


Key issue is Citi’s day one public pool sizing. No local intel on the daily cap yet, but expect a tightly controlled, gradual opening over the first 3-6 months.
Likely shifting from FCFS to pro rata allocation, with Citi aggregating daily demand, setting a cutoff, and allocating capacity within the daily cap.
Quota hunting could drive intraday distortions, with failed ADR allocations triggering late day unwinds and adding volatility to Hynix local shares after July 29.


Hynix ADR Conversion Goes Live: Quota Hunting Dynamics to Watch

Derivatives and Quantitative Strategist

Gaudenz Schneider

Equity Derivatives

<ul>
<li>KRX-Listed 2x daily leveraged ETFs on SK hynix have been hit by mean-reverting volatility, with the leverage index down sharply month-to-date.</li>
<li>
Assets under management have come under pressure in July, but large inflows have softened the impact of negative price performance.</li>
<li>
ETF inflows remain meaningful relative to underlying liquidity, but on sharp down days they can be more than offset by daily rebalancing sales.</li>
</ul>


KRX-Listed 2x daily leveraged ETFs on SK hynix have been hit by mean-reverting volatility, with the leverage index down sharply month-to-date.

Assets under management have come under pressure in July, but large inflows have softened the impact of negative price performance.

ETF inflows remain meaningful relative to underlying liquidity, but on sharp down days they can be more than offset by daily rebalancing sales.


SK Hynix (000660 KS): Investors Buy Leveraged ETFs Into Sharp Selloff

Equity Long-Short

Mo Aziz

Equity Bottom-Up

<ul>
<li>29 July packs three events into one session: Q2 results, KOSPI listing of the 17.79mn new shares (~US$2.6bn passive demand), and the opening of two-way ADR conversion.</li>
<li>Consensus Q2 operating profit of ~KRW 64tn implies 77% OPM. The feared KIS “miss” is margins flat at 73%. Our model sits at KRW 58tn. Fair Value needs no beat.</li>
<li>The ADR premium 51% but halved within two sessions, with no conversion channel yet open. We believe Korean shares are more attractive building up to the results on 29 July. </li>
</ul>


29 July packs three events into one session: Q2 results, KOSPI listing of the 17.79mn new shares (~US$2.6bn passive demand), and the opening of two-way ADR conversion.
Consensus Q2 operating profit of ~KRW 64tn implies 77% OPM. The feared KIS “miss” is margins flat at 73%. Our model sits at KRW 58tn. Fair Value needs no beat.
The ADR premium 51% but halved within two sessions, with no conversion channel yet open. We believe Korean shares are more attractive building up to the results on 29 July. 


SK Hynix (000660KS, SKHY US) — 29 July Judgment Day: Q2 Preview and the Premium's Date with Gravity

<ul>
<li>Hynix’s FSS engagement strongly signals a potential treasury buyback into ADR conversion.</li>
<li>Tight early conversion quotas could let Hynix capture capacity upfront, pressuring local shares and forcing ADR premium assumptions above TSMC’s 30% historical peak.</li>
<li>Need to price in upside beyond TSMC’s 30% peak, as Hynix could capture premium expansion early, creating a key risk for ADR premium trading setup.</li>
</ul>


Hynix’s FSS engagement strongly signals a potential treasury buyback into ADR conversion.
Tight early conversion quotas could let Hynix capture capacity upfront, pressuring local shares and forcing ADR premium assumptions above TSMC’s 30% historical peak.
Need to price in upside beyond TSMC’s 30% peak, as Hynix could capture premium expansion early, creating a key risk for ADR premium trading setup.


Newly Surfaced Risk to Hynix ADR Premium Trade

Technology / Semiconductor / Internet Research

Nicolas Baratte

<ul>
<li>In 4Q25, ASML guidance for 2026 revenues was €36.5bn. In 1Q26, revised up to 38bn. In 2Q26 revised up to 44bn. ASML gross margins estimates up from 52% to 56%.</li>
<li>EUV capacity increase by 30% in 2027, possibly another 30% in 2028. DUV capacity up 30%. This suggest 20-25% revenue growth, 2028 revenue at ~€65bn above 2030 target (€44-60bn).</li>
<li>This tells us that AI capacity increase is accelerating, both Logic and DRAM. This means that the discussions from end-clients to toolmakers cover several years of increasing demand. </li>
</ul>


In 4Q25, ASML guidance for 2026 revenues was €36.5bn. In 1Q26, revised up to 38bn. In 2Q26 revised up to 44bn. ASML gross margins estimates up from 52% to 56%.
EUV capacity increase by 30% in 2027, possibly another 30% in 2028. DUV capacity up 30%. This suggest 20-25% revenue growth, 2028 revenue at ~€65bn above 2030 target (€44-60bn).
This tells us that AI capacity increase is accelerating, both Logic and DRAM. This means that the discussions from end-clients to toolmakers cover several years of increasing demand. 


ASML: The Clearest Signal of Increasing AI Semiconductor Demand

South Korea

SK hynix Inc. provides products and services for the electronic components industries. The Company manufactures semiconductors such as dynamic random access memory (DRAM), NAND flash memory, and static random access memory (SRAM) chips.

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SK Hynix (SKHY US)

Hynix ADR Conversion Goes Live: Quota Hunting Dynamics to Watch

Still unconfirmed whether the 2.5 percent real headroom versus 25 percent macro is an internal leak, but the setup looks credible. Hynix appears to...

Sanghyun Park

SK Hynix (000660 KS): Investors Buy Leveraged ETFs Into Sharp Selloff

SK hynix leveraged ETFs face July AUM pressure, but large inflows and rebalancing sales reveal a more nuanced demand and liquidity picture.

Gaudenz Schneider

SK Hynix (000660KS, SKHY US) — 29 July Judgment Day: Q2 Preview and the Premium's Date with Gravity

July 29 brings Q2 results, KOSPI listing, and ADR conversion, with consensus on operating profit and ADR premium fluctuation. Korean shares look...

Mo Aziz

Newly Surfaced Risk to Hynix ADR Premium Trade

This post flags a newly surfaced risk to the Hynix ADR premium hunting thesis and examines its potential implications for the timing, structure,...

Sanghyun Park

ASML: The Clearest Signal of Increasing AI Semiconductor Demand

ASML revenue guidance for 2026 has been consistently revised upwards, with estimates now reaching €44bn. Increased EUV and DUV capacity suggests...

Nicolas Baratte

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Hynix ADR Conversion Goes Live: Quota Hunting Dynamics to Watch

Still unconfirmed whether the 2.5 percent real headroom versus 25 percent macro is an internal leak, but the setup looks credible. Hynix appears to...

Sanghyun Park

SK Hynix (000660 KS): Investors Buy Leveraged ETFs Into Sharp Selloff

SK hynix leveraged ETFs face July AUM pressure, but large inflows and rebalancing sales reveal a more nuanced demand and liquidity picture.

Gaudenz Schneider

SK Hynix (000660KS, SKHY US) — 29 July Judgment Day: Q2 Preview and the Premium's Date with Gravity

​July 29 brings Q2 results, KOSPI listing, and ADR conversion, with consensus on operating profit and ADR premium fluctuation. Korean shares look...

Mo Aziz

Newly Surfaced Risk to Hynix ADR Premium Trade

This post flags a newly surfaced risk to the Hynix ADR premium hunting thesis and examines its potential implications for the timing, structure,...

Sanghyun Park

ASML: The Clearest Signal of Increasing AI Semiconductor Demand

​ASML revenue guidance for 2026 has been consistently revised upwards, with estimates now reaching €44bn. Increased EUV and DUV capacity suggests...

Nicolas Baratte

July 29 brings Q2 results, KOSPI listing, and ADR conversion, with consensus on operating profit and ADR premium fluctuation. Korean shares look...

ASML revenue guidance for 2026 has been consistently revised upwards, with estimates now reaching €44bn. Increased EUV and DUV capacity suggests...