In today’s briefing:
- HSCEI Index Rebalance: Why Did Pop Mart (9992 HK) Miss?
- CSOP Sammy ETF + Korean Retail Leverage Frenzy = Contango Basis Arb Alert
HSCEI Index Rebalance: Why Did Pop Mart (9992 HK) Miss?
- We had Pop Mart International (9992 HK) at the cusp of index inclusion. An increase in Postal Savings Bank of China (1658 HK)‘s FAF led to Pop Mart missing out.
- Estimated one-way turnover at the rebalance is 3.18% leading to a round-trip trade of HK$3.8bn (US$489m).
- There are large inflows for NetEase (9999 HK), Trip.com Group (9961 HK) and Baidu (9888 HK) due to a FAF methodology change for Secondary Listings.
CSOP Sammy ETF + Korean Retail Leverage Frenzy = Contango Basis Arb Alert
- CSOP told Korean media this Sammy ETF product targets Korea’s local retail traders wanting leveraged or short KOSPI exposure, especially Sammy, without using Korea’s derivatives market—essentially a cross-border retail play.
- Korean retail’s insanely strong demand for anything leveraged, combined with limited domestic derivatives access, makes significant local inflows very likely—far from a moonshot.
- TRS use doesn’t guarantee 1:1 futures buying—depends on broker hedging. But, with Samsung futures volume surging, heavy retail flows in CSOP ETF could cause contango and a basis arb opportunity.
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