In today’s briefing:
- Ping An A/H Premium: Outpacing the Market
- China/HSI Uptick Short Levels
- Crypto Lending Series (#2) Clearpool – A Bright Spot Emerging from the Rubble
- Sunshine Insurance Group Pre-IPO – The Negatives – Lacks Growth
Ping An A/H Premium: Outpacing the Market
- The selloff in the broader market has led to the A/H premium on PingAn blowing out to levels not seen in the last few years and outpacing the HSASP Index.
- At a 24% premium, the risk/reward for a long Ping An Insurance (H) (2318 HK) / short Ping An Insurance Group (601318 CH) trade has never been better.
- The shift from A-shares to H-shares is already taking place – Southbound Stock Connect holdings have been increasing while the Northbound Stock Connect holdings have been decreasing.
China/HSI Uptick Short Levels
- Bear impulse in China/HK sets up a sell on a squeeze. Sell volumes ignited on the A50 12,400 support break. HSI has been our top short in Asia and rewarded.
- We did trim our HSI short at the 15k target but still represents 10% of our book. RSI is oversold with short squeeze risk (then re cycle short).
- Hong Kong likes to bottom on big impulsive downside moves so will be interesting how our price and timing models converge.
Crypto Lending Series (#2) Clearpool – A Bright Spot Emerging from the Rubble
- As the crypto lending market recovers from the shock of large defaults in the sector, the markets are now focused on institutional lending where capital efficiency and liquidity are key.
- Overcollateralized lending has been stagnant although holding ground, but its low utilization, low interest rates and wide bid ask are not appealing to most lenders and borrowers.
- The market preference is switching to non-collateralized lending where a mix of Cefi and Defi characteristics may evolve to provide the winning combination.
Sunshine Insurance Group Pre-IPO – The Negatives – Lacks Growth
- Sunshine Insurance Group (SIG), a life, health and P&C insurance company, aims to raise up to US$1bn in its HK IPO.
- SIG is an integrated insurance provider which offers both life and health (L&H) and property and casualty (P&C) insurance in China.
- In this note, we talk about the not-so-positive aspects of the deal.
💡 Before it’s here, it’s on Smartkarma
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