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

<ul>
<li>Samsung SDI and LG Chem are expected to be newly included in the index, while Hana Financial and KT&amp;G Corporation are predicted to be excluded.</li>
<li>The correlation between the price movement and the flow direction on the rebalancing trading day of constituent changes from the past reviews was quite high.</li>
<li>We can set the price impact expectation for the upcoming review even more aggressively, given that the size of the flow x DTV is more significant than in previous cases.</li>
</ul>


Samsung SDI and LG Chem are expected to be newly included in the index, while Hana Financial and KT&amp;G Corporation are predicted to be excluded.
The correlation between the price movement and the flow direction on the rebalancing trading day of constituent changes from the past reviews was quite high.
We can set the price impact expectation for the upcoming review even more aggressively, given that the size of the flow x DTV is more significant than in previous cases.


Price/Flow Impact on Four Constituent Changes in KODEX Top 5 Plus ETF Rebalancing in June

Semiconductor & Technology Specialist, Ingenuity

William Keating

Semiconductor & Technology Specialist

Thematic (Sector/Industry)

<ul>
<li>ASPs &amp; bit shipments decreased by high single digits percent QoQ</li>
<li>Anticipated recovery in H2 '23 will be slow &amp; gradual</li>
<li>The potential for inventory write-downs remains a headwind but March revenue MoM increase is a hopeful sign</li>
</ul>


ASPs &amp; bit shipments decreased by high single digits percent QoQ
Anticipated recovery in H2 '23 will be slow &amp; gradual
The potential for inventory write-downs remains a headwind but March revenue MoM increase is a hopeful sign


Mirae Asset Tiger 200 It ETF / Event-Driven

<ul>
<li>In KOSPI 200 IT Sector Index rebalancing in June, we should consider using Samsung SDS as a hedge for short positions on KakaoPay from a day trading perspective.</li>
<li>The expected performance of traditional flow trading based on passive impact has become uncertain due to flexible rebalancing trading by local pensions and short selling resumption on K200 new entrants.</li>
<li>As such, flow events on these sector indices that are still pretty much under the radar in the market could be a meaningful alternative for us.</li>
</ul>


In KOSPI 200 IT Sector Index rebalancing in June, we should consider using Samsung SDS as a hedge for short positions on KakaoPay from a day trading perspective.
The expected performance of traditional flow trading based on passive impact has become uncertain due to flexible rebalancing trading by local pensions and short selling resumption on K200 new entrants.
As such, flow events on these sector indices that are still pretty much under the radar in the market could be a meaningful alternative for us.


An Alternative Flow Trading Angle for K200 Rebalancing in June

<ul>
<li>Samsung's Q1 2023 operating profit has collapsed to 0.6 trillion Korean won (TKW), down from 4.31 TKW in Q2 2022 and 14.12 TWK in Q1 2022</li>
<li>A promise to "meaningfully lower" memory production sent competitor shares soaring, presumably in anticipation of a faster end to the current memory downturn.</li>
<li>The memory production cut report is elusive and vaguely attributed. We don't anticipate a return to meaningful profitability in the memory segment until Q1 2024. </li>
</ul>


Samsung's Q1 2023 operating profit has collapsed to 0.6 trillion Korean won (TKW), down from 4.31 TKW in Q2 2022 and 14.12 TWK in Q1 2022
A promise to "meaningfully lower" memory production sent competitor shares soaring, presumably in anticipation of a faster end to the current memory downturn.
The memory production cut report is elusive and vaguely attributed. We don't anticipate a return to meaningful profitability in the memory segment until Q1 2024. 


Samsung Q1 2023 Profit Collapse Triggers Memory Production Cut Promise In Regulatory Filing

<ul>
<li>Q1 2023 revenue of ~US$16.7 billion was at the bottom end of the guided range </li>
<li>Despite the inauspicious start, Q1 revenue still represents sequential growth of 3.6% year on year.</li>
<li>TSMC's earnings commentary on April 20 next will set the stage for how recovery looks across the broader semiconductor industry</li>
</ul>


Q1 2023 revenue of ~US$16.7 billion was at the bottom end of the guided range 
Despite the inauspicious start, Q1 revenue still represents sequential growth of 3.6% year on year.
TSMC's earnings commentary on April 20 next will set the stage for how recovery looks across the broader semiconductor industry


South Korea

Samsung Electronics Co., Ltd. manufactures a wide range of consumer and industrial electronic equipment and products such as semiconductors, personal computers, peripherals, monitors, televisions, and home appliances including air conditioners and microwave ovens. The Company also produces Internet access network systems and telecommunications equipment including mobile phones.

Samsung Electronics Pref Shares (005935 KS)

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Samsung Electronics Pref Shares (005935 KS)

Price/Flow Impact on Four Constituent Changes in KODEX Top 5 Plus ETF Rebalancing in June

This post presents a Long Short basket trade idea on the four potential constituent changes in the KODEX Top 5 Plus TR ETF rebalancing in June.

Sanghyun Park

Nanya Q1 2023 Revenue Declines 19.2% QoQ

ASPs & bit shipments decreased by high single digits % QoQ. Anticipated recovery in H2 '23 will be slow & gradual. March revenue MoM increase is a...

William Keating

An Alternative Flow Trading Angle for K200 Rebalancing in June

This post investigates an alternative trading angle on flow events associated with the KOSPI 200 regular rebalancing in June.

Sanghyun Park

Samsung Q1 2023 Profit Collapse Triggers Memory Production Cut Promise In Regulatory Filing

Samsung's Q1 2023 operating profit collapsed to 0.6 TKW, down from 4.31 TKW in Q2 22 and 14.12 TWK in Q1 22. Don't anticipate a return to...

William Keating

TSMC March Revenue Falls 10.9% MoM

Q1 2023 revenue of ~US$16.7 billion was at the bottom end of the guided range. Despite the inauspicious start, Q1 revenue still represents...

William Keating

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