In today’s briefing:
- Curator’s Cut: BABA Hedges, Substantive Spin-Offs & Japanese Activist Situations
- A/H Premium Tracker (To 26 Sep 2025): AH Premia Rise Across the Board
- Volatility Cones: Ping An (2318 HK) And Alibaba (9988 HK) Stand Out
- Relative Value Opportunities in Asia-Pac, Pair Trade Roundup (29 Sep)
- Integral Corp (5842 JP) — Tekscend IPO Crystallizes Value; Discount Persists Without Payouts
- Asia/Pacific Stocks Outlook For the Week Sep 29-Oct 3
- RBA Rate Watch: Navigating ASX 200, Banks, and Resources
Curator’s Cut: BABA Hedges, Substantive Spin-Offs & Japanese Activist Situations
- Welcome to Curator’s Cut, a fortnightly roundup of standout themes from the 1,000+ Insights published over the past two weeks on Smartkarma
- In this cut, we review strategies to hedge Alibaba (9988 HK) exposure, examine signficant Asian spin-offs, and explore engaging activist situations in Japan
- Want to dig deeper? Comment or message with the themes you’d like to see highlighted next
A/H Premium Tracker (To 26 Sep 2025): AH Premia Rise Across the Board
- “Beautiful Skew” showed up slightly as Hs underperformed their As across the board (every sector, every premium tranche), but more on narrow AH Premia.
- Last week’s short reco on China Merchants Bank H (3968 HK) saw the H-share underperform its A by 2.54% and it outright fell 3.14%. OK week.
- The data tables below update on a daily basis in the Tools section of Smartkarma. The SOUTHBOUND Flow Monitor and AH Pairs Monitor are both there – free – for all SK readers.
Volatility Cones: Ping An (2318 HK) And Alibaba (9988 HK) Stand Out
- Context: Volatility cones provide a straightforward framework to evaluate whether options are trading cheap or rich. This Insight provides volatility analysis for eight prominent Hong Kong stocks
- Highlights: Ping An Insurance (H) (2318 HK)stands out with historically low implied volatility across the term structure. Alibaba (9988 HK)is rich in November and December contracts.
- Why Read: Spot opportunities, assess regime shifts, and manage risk effectively — volatility cones turn complex data into actionable insights for traders and investors.
Relative Value Opportunities in Asia-Pac, Pair Trade Roundup (29 Sep)
- Context: This Insight follows up on previously highlighted relative value opportunities, using a statistical methodology based on mean-reversion to identify opportunities in paired securities.
- Highlights: Currently ten pair trade opportunities across four markets and four sectors persist.
- Why read: Statistical analysis offers a unique perspective on relative value. Gain insights into actionable statistical pair trade opportunities and monitor performance of previously highlighted pairs.
Integral Corp (5842 JP) — Tekscend IPO Crystallizes Value; Discount Persists Without Payouts
- NAV crystallization from Tekscend IPO – ~¥108 bn cash proceeds plus a ~14% residual stake; base NAV ~¥150–160 bn vs. ¥129 bn market cap (15–20% discount).
- Upside capped without payout shift – modest base case (¥3,900–4,100/share, flat to +7%); bull case (¥4,400, +15–20%) requires high-end IPO pricing and explicit return policy.
- Persistent structural discount – low dividend (~0.9% yield), no buyback track record, and opaque residual portfolio (e.g., Golf Digest) keep holdco discount entrenched.
Asia/Pacific Stocks Outlook For the Week Sep 29-Oct 3
- Multi-Week forecasts for the Asian indices and stocks we track, based on our proprietary probability model.
- OVERBOUGHT: Samsung Electronics (005930 KS) , Softbank Group (9984 JP) , Toyota Motor (7203 JP) , Nikkei 225 (NKY INDEX)
- OVERSOLD: China Mobile (941 HK) , Fast Retailing (9983 JP)
RBA Rate Watch: Navigating ASX 200, Banks, and Resources
- The Reserve Bank of Australia (RBA) meets on Tuesday, 30 September 2025, with a rate decision due at 14:30h AEST.
- Highlights: Consensus is firmly for a hold (96% probability), but surprise cuts have historically doubled the market’s typical daily move. Sector impacts—banks vs. resources—closely examined.
- Why Read: An actionable roadmap to sector sensitivities, highlighting bank and resource ETFs as tactical vehicles if the RBA deviates from expectations.
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