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

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

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

Event-Driven

SAMSUNG KODEX KOREA Value-Up ETF / Event-Driven

SAMSUNG KODEX KOREA Value-up ETF is an exchange-traded fund incorporated in South Korea. The objective of the fund is to achieve return that closely replicates the performance of KOREA Value-up Index. The fund invest more than 60 % in equity.

SAMSUNG KODEX KOREA Value-Up ETF (495850 KS)

<ul>
<li>They ditched the rulebook, used a market cap filter to pick the top 5, and watered down PBR and ROE, making them irrelevant. Market cap was the real deciding factor.</li>
<li>KRX hasn't confirmed it, but local sources say the special rebalancing was based on the top 50 KOSPI market caps as of the December 13th close.</li>
<li>The shift was driven by local pension funds, especially NPS, which pushed for more big-cap exposure to trigger Value-Up investments, signaling a potential ramp-up in their involvement.</li>
</ul>


They ditched the rulebook, used a market cap filter to pick the top 5, and watered down PBR and ROE, making them irrelevant. Market cap was the real deciding factor.
KRX hasn't confirmed it, but local sources say the special rebalancing was based on the top 50 KOSPI market caps as of the December 13th close.
The shift was driven by local pension funds, especially NPS, which pushed for more big-cap exposure to trigger Value-Up investments, signaling a potential ramp-up in their involvement.


Behind the Scenes of KRX Value-Up Index Special Rebalancing: What It Means for Flow Dynamics

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Posco International Corporation is a general trading company.  The Company exports and imports steel, cement, crude oil, heavy machinery, automobile parts, and textiles.  Daewoo also manufactures synthetic fabrics for footwear, garments, and car seats, and operates a department store in Masan.

Posco International Corporation (047050 KS)

<ul>
<li>Both POSCO Holdings (005490 KS) and Posco International Corporation (047050 KS) provided solid, new Corporate Value Up reports. </li>
<li>However, POSCO International's plan is much better. POSCO International plans to provide total shareholder returns of 50% which is more than double of its previous total shareholder return plan.</li>
<li>This sharp increase in shareholder returns is likely to lead to share outperformance of POSCO International relative to the market in the next several months. </li>
</ul>


Both POSCO Holdings (005490 KS) and Posco International Corporation (047050 KS) provided solid, new Corporate Value Up reports. 
However, POSCO International's plan is much better. POSCO International plans to provide total shareholder returns of 50% which is more than double of its previous total shareholder return plan.
This sharp increase in shareholder returns is likely to lead to share outperformance of POSCO International relative to the market in the next several months. 


New Corporate Value Up Plans of POSCO Holdings and POSCO International

<ul>
<li>With the Fed shock pushing the won past 1,450 and the KOSPI down, it's time to dig into the stabilization fund—its size, timing, and which stocks will catch the flow.</li>
<li>With ₩10T in play, even spread over 10 stages, it could drive significant price impact. NPS's ₩1.5T injection in December shows how even smaller flows move the market.</li>
<li>The FSC plans to focus on KOSPI 200 and broad market ETFs, with new ETFs like the Value-Up Index likely getting more flow—target stocks in both for bigger impact.</li>
</ul>


With the Fed shock pushing the won past 1,450 and the KOSPI down, it's time to dig into the stabilization fund—its size, timing, and which stocks will catch the flow.
With ₩10T in play, even spread over 10 stages, it could drive significant price impact. NPS's ₩1.5T injection in December shows how even smaller flows move the market.
The FSC plans to focus on KOSPI 200 and broad market ETFs, with new ETFs like the Value-Up Index likely getting more flow—target stocks in both for bigger impact.


Korea FSC's Stabilization Fund: Breaking Down the Buzz and Flow Impact

KB Financial Group Inc. (the "Company"), in accordance with Financial Holding Companies Act, was established on September 29, 2008, through stock transfer with the former shareholders of its subsidiaries including Kookmin Bank in order to provide management services and financing to associated companies. The headquarters are located at Seoul, Korea

<ul>
<li>On 26 September, the Korea Exchange announced that it is considering a <em><strong>"special rebalancing"</strong></em> of the Korea Value-Up Index in December 2024.</li>
<li>In our view, the probability of this special rebalancing occurring by the end of this year is high at about 85%+.</li>
<li>If there is a special rebalancing, KB Financial, Hana Financial, Samsung Life Insurance, SK Telecom, and KT could be considered the top candidates for inclusion. </li>
</ul>


On 26 September, the Korea Exchange announced that it is considering a "special rebalancing" of the Korea Value-Up Index in December 2024.
In our view, the probability of this special rebalancing occurring by the end of this year is high at about 85%+.
If there is a special rebalancing, KB Financial, Hana Financial, Samsung Life Insurance, SK Telecom, and KT could be considered the top candidates for inclusion. 


A Special Rebalancing Of Korea Value-Up Index Is Likely in December 2024

Hyundai Mobis Co., Ltd. manufactures and markets automotive parts and equipment, such as  automotive service components, modules, and systems. The Company also contractsenvironmental projects, including sewage treatment plant and industrial waste water treatment plant construction.

<ul>
<li>KRX updated the Value-Up Index with five new names: KB Financial, Hana Financial, KT Corp, SK Telecom, and Hyundai Mobis, with Mobis replacing JB Financial, surprising the market.</li>
<li>This is the first rebalancing, packed into one day, so expect notable price action. Reverse moves could also follow Thursday as pre-positioned trades unwind, so monitor price action closely.</li>
<li>Even after Thursday's rebalancing, half of the funds, especially from the National Pension Service, will flow into high-yield stocks, likely driving significant price moves through early next year.</li>
</ul>


KRX updated the Value-Up Index with five new names: KB Financial, Hana Financial, KT Corp, SK Telecom, and Hyundai Mobis, with Mobis replacing JB Financial, surprising the market.
This is the first rebalancing, packed into one day, so expect notable price action. Reverse moves could also follow Thursday as pre-positioned trades unwind, so monitor price action closely.
Even after Thursday's rebalancing, half of the funds, especially from the National Pension Service, will flow into high-yield stocks, likely driving significant price moves through early next year.


KRX Value-Up Index Rebalance Results and Estimated Passive Impact

Impact of reforms on South Korea Companies

South Korea Value-Up
Impact of reforms on South Korea Companies

Behind the Scenes of KRX Value-Up Index Special Rebalancing: What It Means for Flow Dynamics

This post provides the inside scoop on the KRX Value-Up Index special rebalancing and its implications for flow dynamics.

Sanghyun Park

New Corporate Value Up Plans of POSCO Holdings and POSCO International

Both POSCO Holdings (005490 KS) and Posco International Corporation (047050 KS) provided solid, new Corporate Value Up reports. However, POSCO...

Douglas Kim

Korea FSC's Stabilization Fund: Breaking Down the Buzz and Flow Impact

This post breaks down the buzz around the Korean FSC potentially triggering the stabilization fund and digging into the flow impact from a market...

Sanghyun Park

A Special Rebalancing Of Korea Value-Up Index Is Likely in December 2024

KRX announced announced that a special rebalancing of 5 stocks to be included in the ‘Korea Value Up Index’ - KB Financial, Hana Financial, Hyundai...

Douglas Kim

KRX Value-Up Index Rebalance Results and Estimated Passive Impact

This post breaks down the latest special rebalancing results for the KRX Value-Up Index, along with the estimated passive impact.

Sanghyun Park