Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Index Rebalance

Beijing Kingsoft Office Softwa / Index Rebalance

The <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX)</a> consists of stocks from the Shanghai Stock Exchange and the Shenzhen Stock Exchange and is one of the most widely tracked A-share indices with passive tracking products listed in multiple markets globally. There are CFFEX listed futures that trade actively as well.China Securities Index Co (CSI) will announce the changes end May/beginning June and the changes will be effective after the close of trading on 11 June.There were 21 changes to the index at the June 2020 review and 26 changes at the December 2020 review. We expect 30 changes at the upcoming June 2021 index review - this is the maximum number of changes that are permitted at a single review. Estimated one-way turnover is 4.56%.With passive tracking products holding around US$32bn of AUM, plus another US$53bn in open interest on the listed futures, plus active managers benchmarked to the <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX)</a>, there could be significant moves in the inclusion/exclusion names from now to the end of the review period. There will only be 9-10 trading days between the announcement of the changes and the implementation, so having a pre-position should pay off. There should not be too many changes in the possible list of inclusions and exclusions due to the averaging process over the last year of trading.

The Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX) consists of stocks from the Shanghai Stock Exchange and the Shenzhen Stock Exchange and is one of the most widely tracked A-share indices with passive tracking products listed in multiple markets globally. There are CFFEX listed futures that trade actively as well.China Securities Index Co (CSI) will announce the changes end May/beginning June and the changes will be effective after the close of trading on 11 June.There were 21 changes to the index at the June 2020 review and 26 changes at the December 2020 review. We expect 30 changes at the upcoming June 2021 index review - this is the maximum number of changes that are permitted at a single review. Estimated one-way turnover is 4.56%.With passive tracking products holding around US$32bn of AUM, plus another US$53bn in open interest on the listed futures, plus active managers benchmarked to the Shanghai Shenzhen CSI 300 Index (SHSZ300 INDEX), there could be significant moves in the inclusion/exclusion names from now to the end of the review period. There will only be 9-10 trading days between the announcement of the changes and the implementation, so having a pre-position should pay off. There should not be too many changes in the possible list of inclusions and exclusions due to the averaging process over the last year of trading.

CSI300 Index Rebalance Preview: Maxing Out the Number of Changes

Equity Analyst focused on Korea Stock Market

Thomas Yi

Thematic (Sector/Industry)

Polyethylene terephthalate (PET: bottle grade) spreads have skyrocketed since April, setting five consecutive weekly highs.We see three reasons for the sustained strength in PET spreads: (1) Force majeure events in Europe on May, 2018, (2) Recycling ban in China since early 2018, (3) Mossi Ghisolfi Group bankruptcy at end-2017Leading global manufacturers of PET resin (bottle grade) obviously will benefit: <a href="https://www.smartkarma.com/entities/18105" target="_blank" data-smartkarma-citation="entities:18105:1">Indorama Ventures Pcl (IVL TB)</a>, M&amp;G Chemicals (unlisted; Luxembourg), Equipolymers (unlisted; Germany), <a href="https://www.smartkarma.com/entities/24717" target="_blank" data-smartkarma-citation="entities:24717:1">Alpek SAB de CV (ALPEKA MM)</a>, <a href="https://www.smartkarma.com/entities/17882" target="_blank" data-smartkarma-citation="entities:17882:1">Jiangsu Sanfangxiang Industry Co.Ltd, (600370 CH)</a>, <a href="https://www.smartkarma.com/entities/4878" target="_blank" data-smartkarma-citation="entities:4878:1">Tongkun Group Co Ltd A (601233 CH)</a>, <a href="https://www.smartkarma.com/entities/3653" target="_blank" data-smartkarma-citation="entities:3653:1">Hengyi Petrochemical Co A (000703 CH)</a>, <a href="https://www.smartkarma.com/entities/11448" target="_blank" data-smartkarma-citation="entities:11448:1">Far Eastern New Century Corp (1402 TT)</a>, <a href="https://www.smartkarma.com/entities/10740" target="_blank" data-smartkarma-citation="entities:10740:1">Nan Ya Plastics Corp (1303 TT)</a>, <a href="https://www.smartkarma.com/entities/198" target="_blank" data-smartkarma-citation="entities:198:1">Reliance Industries Ltd (RIL IN)</a>, <a href="https://www.smartkarma.com/entities/8757" target="_blank" data-smartkarma-citation="entities:8757:1">Lotte Chemical Corp (011170 KS)</a>, and <a href="https://www.smartkarma.com/entities/13428" target="_blank" data-smartkarma-citation="entities:13428:1">TK Chemical Corp (104480 KS)</a>

Polyethylene terephthalate (PET: bottle grade) spreads have skyrocketed since April, setting five consecutive weekly highs.We see three reasons for the sustained strength in PET spreads: (1) Force majeure events in Europe on May, 2018, (2) Recycling ban in China since early 2018, (3) Mossi Ghisolfi Group bankruptcy at end-2017Leading global manufacturers of PET resin (bottle grade) obviously will benefit: Indorama Ventures Pcl (IVL TB), M&amp;G Chemicals (unlisted; Luxembourg), Equipolymers (unlisted; Germany), Alpek SAB de CV (ALPEKA MM), Jiangsu Sanfangxiang Industry Co.Ltd, (600370 CH), Tongkun Group Co Ltd A (601233 CH), Hengyi Petrochemical Co A (000703 CH), Far Eastern New Century Corp (1402 TT), Nan Ya Plastics Corp (1303 TT), Reliance Industries Ltd (RIL IN), Lotte Chemical Corp (011170 KS), and TK Chemical Corp (104480 KS)

Perfect Storm: Skyrocketing PET Spreads...What’s Happening and Who Benefits?

China

TongKun Group Co., Ltd. develops, produces and sells polyester and Terylene filament.  The Company also invests in real estate, finance, business trade and education businesses.

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Tongkun Group Co Ltd A (601233 CH)

CSI300 Index Rebalance Preview: Maxing Out the Number of Changes

We see 30 potential inclusions/exclusions to the CSI300 index at the June review that will become effective COB 11 June. With a lot of benchmarked...

Brian Freitas

Perfect Storm: Skyrocketing PET Spreads...What’s Happening and Who Benefits?

Polyethylene terephthalate (PET: bottle grade) spreads have skyrocketed since April, setting five consecutive weekly highs.We see three reasons for...

Thomas Yi

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)