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

Index Rebalance

<ul>
<li>The FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.</li>
<li>The changes for the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-inde" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI 300</a>, <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI 500</a>, <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50</a>, <a href="https://www.smartkarma.com/entities/shanghai-stock-exchange-sse-50-a-share-index" target="_blank" data-smartkarma-citation="entities:31073:1" rel="noopener">SSE50</a> and a bunch of other mainland China indices will be announced after market close on Friday.</li>
<li>Relatively quiet week for ETF flows with no major creations or redemptions during the week.</li>
</ul>


The FRTIB benchmark switch from the EAFE Index to the ACWI IMI ex-USA ex-China ex-Hong Kong Index will result in a round trip trade of around US$56bn.
The changes for the CSI 300, CSI 500, STAR50, SSE50 and a bunch of other mainland China indices will be announced after market close on Friday.
Relatively quiet week for ETF flows with no major creations or redemptions during the week.


Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

Head of Research and Global Chief Strategist, Steno Research

Andreas Steno

Head of Research and Global Chief Strategist

Macro and Geopolitical Research House

Steno Research

Steno Research is a new macro and geopolitical research house. We are based out of Copenhagen, Denmark, but have an international team and a strong network of sources and partners around the world. The team is lead by Andreas Steno, previous global head of strategy at Nordea Bank, and Mikkel Rosenvold, former chief consultant in the Danish Ministry of Finance.

Macroeconomics

<ul>
<li>It is time for one of the most important Bank of Japan meetings in decades.</li>
<li>Markets remain unprepared for a move, despite the pre-warning of a higher inflation forecast. Here is our preview!</li>
<li>It is a no-brainer for the BoJ to increase the inflation forecast given how firm inflation has been relative to forecasts, but the big question is whether it matters for the policy decision? The short answer is yes. </li>
</ul>


It is time for one of the most important Bank of Japan meetings in decades.
Markets remain unprepared for a move, despite the pre-warning of a higher inflation forecast. Here is our preview!
It is a no-brainer for the BoJ to increase the inflation forecast given how firm inflation has been relative to forecasts, but the big question is whether it matters for the policy decision? The short answer is yes. 


Japan Watch: Markets Are Unprepared for BoJ Action

Event-Driven

<ul>
<li>
<a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai Electric (6525 JP)</a>'s listing has been approved by the JPX and the stock is expected to start trading on the Prime Market from 25 October.</li>
<li>At the reported indicative IPO price of JPY 1890/share, <a href="https://www.smartkarma.com/entities/kokusai-electric-corp" target="_blank" data-smartkarma-citation="entities:40152:1" rel="noopener">Kokusai Electric (6525 JP)</a> will be valued at JPY 435bn (US$2.94bn).</li>
<li>The stock should be added to the <a href="https://www.smartkarma.com/entities/tokyo-stock-exchange-tokyo-price-index-topix" target="_blank" data-smartkarma-citation="entities:22910:1" rel="noopener">TPX INDEX</a> at the close on 29 November where trackers will need to buy over 14% of the stock issued in the IPO.</li>
</ul>



Kokusai Electric (6525 JP)'s listing has been approved by the JPX and the stock is expected to start trading on the Prime Market from 25 October.
At the reported indicative IPO price of JPY 1890/share, Kokusai Electric (6525 JP) will be valued at JPY 435bn (US$2.94bn).
The stock should be added to the TPX INDEX at the close on 29 November where trackers will need to buy over 14% of the stock issued in the IPO.


Kokusai Electric (6525 JP) IPO: Listing in October, TPX Inclusion in November, Global Indices Later

Cross Asset Strategy

<ul>
<li>The Bank of Japan moved the needle on the 10yr YCC from an effective cap 0.5% to a new effective cap at 1% but with a larger flexibility being introduced to the setup.</li>
<li>This also means that JGBs are now effectively tradeable again and that two-way-traffic is introduced as the BoJ can decide to guide the 10yr point both higher and lower within the accepted range given incoming data on prices ahead.</li>
<li>This is very different from just communicating a new clear cap and the 10yr yield is trading around +56 bps on the screens by the time of writing.</li>
</ul>


The Bank of Japan moved the needle on the 10yr YCC from an effective cap 0.5% to a new effective cap at 1% but with a larger flexibility being introduced to the setup.
This also means that JGBs are now effectively tradeable again and that two-way-traffic is introduced as the BoJ can decide to guide the 10yr point both higher and lower within the accepted range given incoming data on prices ahead.
This is very different from just communicating a new clear cap and the 10yr yield is trading around +56 bps on the screens by the time of writing.


Japan Watch: 1% with Added Flexibility – More or Less Printing from Here?

Equity/Index & Cross Asset Volatility Specialist, Cameron Design

Jay Cameron

Equity/Index & Cross Asset Volatility Specialist

Cameron Design

We specialize in financial products and volatility. Our strategies balance speed, data, and risk control to capture opportunities across global markets. Our research leverages AI and data analytics to continuously refine our algorithms and adapt to evolving market dynamics.

Equity Derivatives

<ul>
<li>Japanese banks are entering a new, structurally sound phase driven by the BoJ's policy pivot, which is fundamentally elevating Net Interest Income and profitability.</li>
<li>Capital efficiency and mandatory corporate governance reforms are set to significantly close the P/B gap against global peers.</li>
<li>TOPIX Bank Index could be poised for continued outperformance over the broader market, making it an essential, high-conviction portfolio exposure as 8303 Shinsei returns to the index.</li>
</ul>


Japanese banks are entering a new, structurally sound phase driven by the BoJ's policy pivot, which is fundamentally elevating Net Interest Income and profitability.
Capital efficiency and mandatory corporate governance reforms are set to significantly close the P/B gap against global peers.
TOPIX Bank Index could be poised for continued outperformance over the broader market, making it an essential, high-conviction portfolio exposure as 8303 Shinsei returns to the index.


Japanese Banks: TPNBNK Structural Sector Buy-Case, Preparing for Shinsei (8303) January Passive Flow

Japan

The TOPIX, also known as the Tokyo Stock Price Index, is a capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. The index is supplemented by the subindices of the 33 industry sectors. The index calculation excludes temporary issues and preferred stocks, and has a base value of 100 as of January 4, 1968.

TSE Tokyo Price Index TOPIX (TPX INDEX)

Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

Japan Watch: Markets Are Unprepared for BoJ Action

It is time for one of the most important Bank of Japan meetings in decades. Markets remain unprepared for a move, despite the pre-warning of a...

Steno Research

Kokusai Electric (6525 JP) IPO: Listing in October, TPX Inclusion in November, Global Indices Later

Kokusai Electric starts trading today. Initial passive demand will come from TOPIX trackers next month. Flow from global passive trackers will come...

Brian Freitas

Japan Watch: 1% with Added Flexibility – More or Less Printing from Here?

The Bank of Japan moved the needle on the 10yr YCC from an effective cap 0.5% to a new effective cap at 1% but with a larger...

Steno Research

Japanese Banks: TPNBNK Structural Sector Buy-Case, Preparing for Shinsei (8303) January Passive Flow

Japanese banks are experiencing improved profitability due to the BoJ's policy changes, also evidenced by 8303 Shinsei re-listing, leading to...

Jay Cameron

Index Rebalance & ETF Flow Recap: FRTIB, Japan, CSI300, CSI500, STAR50, WuXi XDC, Asahi

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

Japan Watch: Markets Are Unprepared for BoJ Action

It is time for one of the most important Bank of Japan meetings in decades. Markets remain unprepared for a move, despite the pre-warning of a...

Steno Research

Kokusai Electric (6525 JP) IPO: Listing in October, TPX Inclusion in November, Global Indices Later

Kokusai Electric starts trading today. Initial passive demand will come from TOPIX trackers next month. Flow from global passive trackers will come...

Brian Freitas

Japan Watch: 1% with Added Flexibility – More or Less Printing from Here?

The Bank of Japan moved the needle on the 10yr YCC from an effective cap 0.5% to a new effective cap at 1% but with a larger...

Steno Research

Japanese Banks: TPNBNK Structural Sector Buy-Case, Preparing for Shinsei (8303) January Passive Flow

​Japanese banks are experiencing improved profitability due to the BoJ's policy changes, also evidenced by 8303 Shinsei re-listing, leading to...

Jay Cameron

Japanese banks are experiencing improved profitability due to the BoJ's policy changes, also evidenced by 8303 Shinsei re-listing, leading to...