Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

I investigate special situations, pairs, and index rebalancing trades in Korea.

Korea / Special Sits, Pairs, Index Rebalancing

Kakao's De Facto Holding Company K Cube Holdings: Exactly What Are They Accused Of?

Is Kakao Cheap or Not? Actions Louder than Words

Kakao's Timely Trick to Defend Its Inflated Share Price: Merger with Kakao Commerce

The Korean Government Could Follow the Chinese Government in Cracking Down on the Internet Giants

FSC's Sudden Action on Local Financial Platforms: A Fatal Blow to Kakao Pay's IPO Valuation

The Blockchain Delusion. A (Mostly) Bearish Investment Thesis.

Gravity Works As WeWork Doesn't; Now Plan B

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<p>Today's drop in Kakao's share price has a different meaning than yesterday. Yesterday too, Kakao fell more than Naver, but it was not as much of a difference as today. Kakao is currently down 6.5%, while Naver is stopping the decline at 2.32%.</p><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/228/799/original/Screen+Shot+2021-09-08+at+11.33.00+PM.png?1631161467" class="editor-image img-responsive" data-smartkarma-image-id="228799"></figure><p></p></section><p>Yesterday, a rather abstract view emerged that government-level regulations on big tech had begun in Korea, similar to China. Therefore, the market focused on understanding the short-term impact of the actual application and interpretation of the Financial Consumer Protection Act announced by the Financial Services Commission on big tech financial platform businesses.</p><p>So yesterday, the stock prices of Kakao and Naver, two of Korea's major big tech companies, fell together with a modest difference. This is because they all provide financial platform services that are highly likely to violate the Financial Consumer Protection Act in the immediate term.</p><div class="content-highlight"><ul>
<li><strong>But today, other concerns are spreading in the market. The FSC's decision is not to tame big tech in the Chinese style but to publicize big tech regulations externally as a political tool that can greatly benefit the ruling party ahead of the presidential election scheduled for March 9 of next year.</strong></li>
<li><strong>The important point here is that the local market speculates that the ruling party specifically targets Kakao as a political scapegoat.</strong></li>
</ul></div>

Today's drop in Kakao's share price has a different meaning than yesterday. Yesterday too, Kakao fell more than Naver, but it was not as much of a difference as today. Kakao is currently down 6.5%, while Naver is stopping the decline at 2.32%.Yesterday, a rather abstract view emerged that government-level regulations on big tech had begun in Korea, similar to China. Therefore, the market focused on understanding the short-term impact of the actual application and interpretation of the Financial Consumer Protection Act announced by the Financial Services Commission on big tech financial platform businesses.So yesterday, the stock prices of Kakao and Naver, two of Korea's major big tech companies, fell together with a modest difference. This is because they all provide financial platform services that are highly likely to violate the Financial Consumer Protection Act in the immediate term.
But today, other concerns are spreading in the market. The FSC's decision is not to tame big tech in the Chinese style but to publicize big tech regulations externally as a political tool that can greatly benefit the ruling party ahead of the presidential election scheduled for March 9 of next year.
The important point here is that the local market speculates that the ruling party specifically targets Kakao as a political scapegoat.


Concerns Are Growing that Kakao Becomes a Political Scapegoat Ahead of the Presidential Election

Kakao Corp

Concerns Are Growing that Kakao Becomes a Political Scapegoat Ahead of the Presidential Election