Daily BriefsEvent-Driven

Daily Brief Event-Driven: Nikkei 225 Vs TOPIX Dynamics and more

In today’s briefing:

  • Nikkei 225 Vs TOPIX Dynamics
  • Merger Arb Mondays (22 May) – HKBN, Newcrest, InvoCare, United Malt, Golden Energy, Penguin, Shinsei
  • Korea: What Are Foreign Investors Buying & Selling?
  • Meritz Financial: Main Target for Flow Trading in KS200 June Rebalancing

Nikkei 225 Vs TOPIX Dynamics

By Travis Lundy

  • This past week saw dramatic moves in Japanese stock markets. TOPIX +3.1% N225 +4.8% – up the 6th week in a row – closing at their highest in 33 years. 
  • Flows were positive the week before, and I expect we’ll see next week they were positive this past week. But most striking was the interplay between Nikkei 225 and TOPIX.
  • If foreign inflows increase, Nikkei is likely to outperform TOPIX both because of its existence and previous use, and its construction. And that means watching one’s trades, shorts, and executions.

Merger Arb Mondays (22 May) – HKBN, Newcrest, InvoCare, United Malt, Golden Energy, Penguin, Shinsei

By Arun George


Korea: What Are Foreign Investors Buying & Selling?

By Brian Freitas


Meritz Financial: Main Target for Flow Trading in KS200 June Rebalancing

By Sanghyun Park

  • Meritz Financial confirmed the total number of treasury shares resulting from the mergers, amounting to 5.04% of SO. When combined with the largest shareholder’s stake, the float rate becomes 47.75%.
  • We should focus on direct rebalancing flow through KS200 ETFs on T-1 effective rather than setting it up preemptively. The estimated total AUM of ETFs directly mirroring KS200 is ₩17T.
  • Meritz Financial is expected to receive an inflow of around ₩43B, equivalent to 1.35x ADTV. This is a significant flow impact size as a single-day event.

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