Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Event-Driven

<ul>
<li>The Nikkei is now down 9.57% vs. when we first recommended our skew trade (now up 0.40%). </li>
<li>Despite some frustrating idiosyncratic moves which have prevented the skew trade from outperforming more it has mostly held up. </li>
<li>Looking forward, we believe it is worthwhile assessing upside and downside macro risks for the components of the trade.</li>
</ul>


The Nikkei is now down 9.57% vs. when we first recommended our skew trade (now up 0.40%). 
Despite some frustrating idiosyncratic moves which have prevented the skew trade from outperforming more it has mostly held up. 
Looking forward, we believe it is worthwhile assessing upside and downside macro risks for the components of the trade.


TOPIX-Nikkei Skew Trade – Updates Factoring in Ukraine

Equity Long-Short Analyst

Pyari Menon

Thematic (Sector/Industry)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/international-business-machines-corp" target="_blank" data-smartkarma-citation="entities:1064:1" rel="noopener">International Business Machines (IBM US)</a>, <a href="https://www.smartkarma.com/entities/alphabet-inc-cl-c" target="_blank" data-smartkarma-citation="entities:11369:1" rel="noopener">Alphabet Inc Cl C (GOOG US)</a><a href="https://www.smartkarma.com/entities/apple-inc" target="_blank" data-smartkarma-citation="entities:666:1" rel="noopener">Apple Inc (AAPL US)</a>, <a href="https://www.smartkarma.com/entities/amazon-com-inc" target="_blank" data-smartkarma-citation="entities:409:1" rel="noopener">Amazon.com Inc (AMZN US)</a>, and <a href="https://www.smartkarma.com/entities/samsung-electronics-co-ltd" target="_blank" data-smartkarma-citation="entities:191:1" rel="noopener">Samsung Electronics (005930 KS)</a> are the top five AI innovators.</li>
<li>Top "non-tech" companies include medical diagnostic/surgical players like <a href="https://www.smartkarma.com/entities/johnson-johnson" target="_blank" data-smartkarma-citation="entities:1132:1" rel="noopener">Johnson &amp; Johnson (JNJ US)</a>, <a href="https://www.smartkarma.com/entities/medtronic-plc" target="_blank" data-smartkarma-citation="entities:14982:1" rel="noopener">Medtronic Plc (MDT US)</a>, and financials like State Farm Mutual, and <a href="https://www.smartkarma.com/entities/capital-one-financial-corp" target="_blank" data-smartkarma-citation="entities:255:1" rel="noopener">Capital One Financial (COF US)</a>
</li>
<li>Since AI technology includes integrating several areas of technology, we have data-mined from multiple technological areas that we think are fundamental to AI, We have detailed these in the report.</li>
</ul>



International Business Machines (IBM US), Alphabet Inc Cl C (GOOG US)Apple Inc (AAPL US), Amazon.com Inc (AMZN US), and Samsung Electronics (005930 KS) are the top five AI innovators.
Top "non-tech" companies include medical diagnostic/surgical players like Johnson &amp; Johnson (JNJ US), Medtronic Plc (MDT US), and financials like State Farm Mutual, and Capital One Financial (COF US)

Since AI technology includes integrating several areas of technology, we have data-mined from multiple technological areas that we think are fundamental to AI, We have detailed these in the report.


Insights from Data Mining Technical Publications - A Look into Artificial Intelligence

Equity Bottom-Up

<ul>
<li>Sony and Honda announced today they would form a strategic alliance in the mobility field. </li>
<li>Honda will be responsible for manufacturing and after sales while Sony will handle imaging, sensing, telecommunication, network and entertainment technologies. </li>
<li>This helps Sony maintain its asset light model and is also positive for Honda but we do feel that it makes Honda look a little lost in the changing world.</li>
</ul>


Sony and Honda announced today they would form a strategic alliance in the mobility field. 
Honda will be responsible for manufacturing and after sales while Sony will handle imaging, sensing, telecommunication, network and entertainment technologies. 
This helps Sony maintain its asset light model and is also positive for Honda but we do feel that it makes Honda look a little lost in the changing world.


Sony – EV Partnership Is Excellent for Sony but Highlights Honda’s Struggles

<ul>
<li>Over the past few quarters Square Enix has repeatedly been the subject of M&amp;A speculation related to both Microsoft and Sony.</li>
<li>We consider such speculation to be nonsense and have repeatedly said so. </li>
<li>However, there is a far more intriguing M&amp;A prospect in Kadokawa and it has not gotten much press…</li>
</ul>


Over the past few quarters Square Enix has repeatedly been the subject of M&amp;A speculation related to both Microsoft and Sony.
We consider such speculation to be nonsense and have repeatedly said so. 
However, there is a far more intriguing M&amp;A prospect in Kadokawa and it has not gotten much press…


Kadokawa – Rather Than Waste Time Considering a Sony Buyout of Square Enix Look at This Instead

AlphaSituations-Event/Catalyst Driven Research, AlphaSituations

Robert Sassoon

AlphaSituations-Event/Catalyst Driven Research

AlphaSituations

Since its establishment, AlphaSituations has delivered a track record of outperformance with a hit rate of winners of more than 70% of its portfolio of ideas generating annualized average returns of 20%. In January 2022, AlphaSituations was contracted by Water Tower Research, an investor engagement and stakeholder communication platform to provide coverage of Special Situations

<ul>
<li>Microsoft's all cash acquisition of video game publisher Activision Blizzard is the biggest in the former's history and the largest ever transaction in the video gaming sector.</li>
<li>While intense regulatory scrutiny of the deal is expected, the arguments favoring high odds for eventual deal approval are reasonable. </li>
<li>We believe the 17% merger spread offers the prospect of  double-digits annualized return over the next 12 to 18 months.</li>
</ul>


Microsoft's all cash acquisition of video game publisher Activision Blizzard is the biggest in the former's history and the largest ever transaction in the video gaming sector.
While intense regulatory scrutiny of the deal is expected, the arguments favoring high odds for eventual deal approval are reasonable. 
We believe the 17% merger spread offers the prospect of  double-digits annualized return over the next 12 to 18 months.


MergerTalk: Microsoft/Activision Blizzard-Why We Think This Transaction May Not Be Such A Gamble

Japan

Sony Corporation manufactures audio, home video game consoles, communications, key device and information technology products for the consumer and professional markets.  The Company's other businesses include music, pictures, computer entertainment, and online businesses.

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Sony Corp (6758 JP)

TOPIX-Nikkei Skew Trade – Updates Factoring in Ukraine

The Nikkei is down 9.57% vs. when we initiated our skew trade (now up 0.40%). Despite some frustrating idiosyncratic moves the trade has mostly...

Mio Kato

Insights from Data Mining Technical Publications - A Look into Artificial Intelligence

The global artificial intelligence (AI) market is forecast to grow rapidly in the coming years. In this report, we data-mine publications to rank...

Pyari Menon

Sony – EV Partnership Is Excellent for Sony but Highlights Honda’s Struggles

Sony and Honda announced today they would form a strategic alliance in the mobility field. We feel this is positive for both though it makes Honda...

Mio Kato

Kadokawa – Rather Than Waste Time Considering a Sony Buyout of Square Enix Look at This Instead

We consider speculation about a Sony purchase of Square Enix to be nonsense. However, there is a far more intriguing M&A prospect in Kadokawa and...

Mio Kato

MergerTalk: Microsoft/Activision Blizzard-Why We Think This Transaction May Not Be Such A Gamble

Why we think that the prospect of earning double-digits annualized returns from this transaction within the next 18 months might not be such a gamble

Robert Sassoon

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