Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Global equity indexes have staged impressive rallies from oversold levels, and certain hard-hit areas in Europe (STOXX600 Technology, Industrial Goods &amp; Services, and Chemicals Sectors) display bullish short-term price reversals.</li>
<li>We view this as a potential signal that the lows may have been established for this correction, but we need to see more upside follow-through.</li>
<li>Regardless, we want to stick with Sectors and stocks that have remained technically attractive throughout this pullback, not on areas that are just now spiking from oversold levels within downtrends.</li>
</ul>


Global equity indexes have staged impressive rallies from oversold levels, and certain hard-hit areas in Europe (STOXX600 Technology, Industrial Goods &amp; Services, and Chemicals Sectors) display bullish short-term price reversals.
We view this as a potential signal that the lows may have been established for this correction, but we need to see more upside follow-through.
Regardless, we want to stick with Sectors and stocks that have remained technically attractive throughout this pullback, not on areas that are just now spiking from oversold levels within downtrends.


Value Remains Leadership; Actionable Ideas: Energy, Financials, Industrials, and Materials

Silver Point

Thomas J. Monaco

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Thematic (Sector/Industry)

• Related Party Risk: Related parties have incentives to push American Life and Security (ALS) way out on the credit risk curve to enhance investment yield;• Layering of Structured Products:Addition of structured products and other illiquid securities raise stress test concerns; and • Significant Risks:Numerous other investment risks suggest investment manager needs reining in, along with additional checks for related parties.

• Related Party Risk: Related parties have incentives to push American Life and Security (ALS) way out on the credit risk curve to enhance investment yield;• Layering of Structured Products:Addition of structured products and other illiquid securities raise stress test concerns; and • Significant Risks:Numerous other investment risks suggest investment manager needs reining in, along with additional checks for related parties. 

Asia Pac ECM and Index Rebal, Shenton Research

Ke Yan, CFA, FRM

Asia Pac ECM and Index Rebal

Asia Pac IPO & Placement Research, China Biotech

DZT Research

DZT Research is an independent Asia Pacific equity specialist. Our quantitative research covers index rebalancing flows, alongside exchange data analytics accross Asia Pacific. On the equity capital markets side, we focus on Asia Pacific ECM, especially biotech and TMT. Our lead analyst is frequently cited by international media.

Quantitative Analysis

<ul>
<li>We analyzed the changes in margin trading positions of JPX stocks as of Jul 3rd. The aggregated net margin trading position is USD31,784m.</li>
<li>We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.</li>
<li>We highlight net margin buy/sell changes in Kioxia, Skylark, McDonald's, Taiyo Yuden, Advantest, Nintendo, Japan Tobacco, Pan Pacific International, Tokyo Electron, Monogatari.</li>
</ul>


We analyzed the changes in margin trading positions of JPX stocks as of Jul 3rd. The aggregated net margin trading position is USD31,784m.
We tabulate league tables for top/bottom net long/short of margin trading by value, net margin buy as multiple of ADT.
We highlight net margin buy/sell changes in Kioxia, Skylark, McDonald's, Taiyo Yuden, Advantest, Nintendo, Japan Tobacco, Pan Pacific International, Tokyo Electron, Monogatari.


JPX Margin Trading Weekly (Jul 3rd): Kioxia, Skylark, McDonald's, Taiyo Yuden, Advantest, Nintendo

*Texas Storms = Japan Risk:Insurers could suffer record 1Q20 catastrophic (CAT) losses after the historic State of Texas (and beyond) winter storm Uri, which crippled Texas’ electrical grid and caused extensive property damage. Most directly exposed would appear to be Sompo (~2%), and Tokio Marine (1%); and*Watch Your Reinsurance: The risk of this Uri event hitting reinsurance layers is quickly rising given the fluid events and the creep in losses. The situation looks to be quite dicey given the economic impact estimate of between USD 45-50 bn. Add this to Texas’ poor handling of COVID-19, and no doubt this CAT event will result higher bankruptcies across retail energy power companies, energy drillers, etc. which should be additive to reinsurance losses.

*Texas Storms = Japan Risk:Insurers could suffer record 1Q20 catastrophic (CAT) losses after the historic State of Texas (and beyond) winter storm Uri, which crippled Texas’ electrical grid and caused extensive property damage. Most directly exposed would appear to be Sompo (~2%), and Tokio Marine (1%); and*Watch Your Reinsurance: The risk of this Uri event hitting reinsurance layers is quickly rising given the fluid events and the creep in losses. The situation looks to be quite dicey given the economic impact estimate of between USD 45-50 bn. Add this to Texas’ poor handling of COVID-19, and no doubt this CAT event will result higher bankruptcies across retail energy power companies, energy drillers, etc. which should be additive to reinsurance losses.

Japan Insurers – Texas, Don’t Hold ‘Em

*Reversing Course Again: On April 3, 2020, the European Insurance and Occupational Pensions Authority (EIOPA) - the European Union’s financial regulatory body which replaced the Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS) – in the context of the corona virus, released a statement urging insurers to “temporarily suspend all discretionary dividend distributions and share buybacks aimed at remunerating shareholders” in order to preserve capital. In an odd reversal of course, EIOPA has updated its commentary surrounding European insurance capital management; and  *Asia-Pacific Insurers Still At Risk: Asia-Pacific insurance counterparts previously acted in capital solidarity with their Western peer during COVID-19. Many Asia-Pacific insurers purchased USD-denominated assets in their desperate search for yield in this low/negative rate environment where the impact of credit default and ratings agency downgrades on their investment portfolios is likely to continue to be outsized and challenge capital their ratios. We are hopeful that the Asia-Pacific insurers - particularly in Japan, Australia, Taiwan, and South Korea – don’t behave as desperately as their European counterparts have.

*Reversing Course Again: On April 3, 2020, the European Insurance and Occupational Pensions Authority (EIOPA) - the European Union’s financial regulatory body which replaced the Committee of European Insurance and Occupational Pensions Supervisors (CEIOPS) – in the context of the corona virus, released a statement urging insurers to “temporarily suspend all discretionary dividend distributions and share buybacks aimed at remunerating shareholders” in order to preserve capital. In an odd reversal of course, EIOPA has updated its commentary surrounding European insurance capital management; and  *Asia-Pacific Insurers Still At Risk: Asia-Pacific insurance counterparts previously acted in capital solidarity with their Western peer during COVID-19. Many Asia-Pacific insurers purchased USD-denominated assets in their desperate search for yield in this low/negative rate environment where the impact of credit default and ratings agency downgrades on their investment portfolios is likely to continue to be outsized and challenge capital their ratios. We are hopeful that the Asia-Pacific insurers - particularly in Japan, Australia, Taiwan, and South Korea – don’t behave as desperately as their European counterparts have. 

Japan

Tokio Marine Holdings, Inc., through subsidiaries, offers property, casualty and life insurance, and asset management services.

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Tokio Marine Holdings (8766 JP)

Value Remains Leadership; Actionable Ideas: Energy, Financials, Industrials, and Materials

We are sticking with Sectors and stocks that have remained technically sound throughout this correction, not on areas that are just now spiking...

Vermilion Research

Midwest Holding - Johnny Hedge Fund

MIDWEST HOLDING: Related parties have pushed ALS out on the risk curve; structured products/illiquid securities raise stress test concerns; and ...

Thomas J. Monaco

JPX Margin Trading Weekly (Jul 3rd): Kioxia, Skylark, McDonald's, Taiyo Yuden, Advantest, Nintendo

We analyzed JPX margin trading positions report for the past week and highlighted Kioxia (285A JP), Skylark (3197 JP), McDonald's (2702 JP), Taiyo...

Ke Yan, CFA, FRM

Japan Insurers – Texas, Don’t Hold ‘Em

JAPAN INSURANCE: Insurers could suffer record 1Q20 catastrophic (CAT) losses after the Texas winter storm. Most directly exposed are Sompo (~2%)...

Thomas J. Monaco

Asian Insurers – Mea, Mea EIOPA

ASIA INSURERS: On April 3, 2020, EIOPA temporarily suspended capital management activities," but just reversed course. Many Asia-Pacific insurers...

Thomas J. Monaco

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