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

Mirae Asset TIGER Secondary Cell ETF / Event-Driven

<ul>
<li>There seems to be no constituent change this time. However, opportunities from cap reversion are likely to lead to noteworthy passive flows.</li>
<li>Ecopro BM and Ecopro Co will experience a weight movement of -4.35% and -3.68%p. On the other hand, SK Innovation will enjoy the most pleasant passive impact.</li>
<li>At KODEX Battery's March rebalancing, the Long SK Innovation Short Ecopro BM position setup provided a return of more than 10% with a similar level of impact x ADTV.</li>
</ul>


There seems to be no constituent change this time. However, opportunities from cap reversion are likely to lead to noteworthy passive flows.
Ecopro BM and Ecopro Co will experience a weight movement of -4.35% and -3.68%p. On the other hand, SK Innovation will enjoy the most pleasant passive impact.
At KODEX Battery's March rebalancing, the Long SK Innovation Short Ecopro BM position setup provided a return of more than 10% with a similar level of impact x ADTV.


Flow Trading Targeting Cap Reversion in TIGER Battery ETF Rebalancing on April 13

Mirae Asset Tiger Top 10 ETF / Event-Driven

<ul>
<li>Celltrion and Posco Holdings will switch places. Although there is still time until the screening period, the market capitalization gap between them has already widened significantly.</li>
<li>Posco Holdings will likely welcome a passive inflow of 0.44x ADTV, whereas Celltrion is expected to face outflows of around 0.69x ADTV.</li>
<li>Ecopro BM entered the Top 20 (preliminary screening table) with a YTD stock price increase of 130%, becoming the first KOSDAQ-listed company to do so.</li>
</ul>


Celltrion and Posco Holdings will switch places. Although there is still time until the screening period, the market capitalization gap between them has already widened significantly.
Posco Holdings will likely welcome a passive inflow of 0.44x ADTV, whereas Celltrion is expected to face outflows of around 0.69x ADTV.
Ecopro BM entered the Top 20 (preliminary screening table) with a YTD stock price increase of 130%, becoming the first KOSDAQ-listed company to do so.


Long Short Setup Candidate: Posco Holdings & Celltrion with TIGER Top 10 Rebalancing

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

EcoPro Materials / Equity Capital Markets

<ul>
<li>Ecopro Materials, an affiliate of Ecopro, is getting ready to complete its IPO in 2H 2023. Ecopro Co has a 52.8% stake in Ecopro Materials. </li>
<li>Ecopro Materials' core products are lithium cell core materials called precursors, which are used as part of the rechargeable batteries. </li>
<li>The expected market value of Ecopro Materials is about 3 trillion won to 4 trillion won (US$2.3 billion to US$3.0 billion).</li>
</ul>


Ecopro Materials, an affiliate of Ecopro, is getting ready to complete its IPO in 2H 2023. Ecopro Co has a 52.8% stake in Ecopro Materials. 
Ecopro Materials' core products are lithium cell core materials called precursors, which are used as part of the rechargeable batteries. 
The expected market value of Ecopro Materials is about 3 trillion won to 4 trillion won (US$2.3 billion to US$3.0 billion).


Initial Thoughts on the Ecopro Materials IPO

<ul>
<li>Ecopro BM's weight has expanded to 22%. Since the probability of receiving a 15% cap is virtually 100%, it will inevitably undergo a weight change of up to nearly 7%p.</li>
<li>If the ongoing rally subsides before March 10th and returns to the January DTV level, the price impact could surge up to 0.3-0.4x daily for three trading days.</li>
<li>This seems to be a sufficient level for a shorting entry point. It may be worth considering an outright short position on Ecopro BM or Long Short with SK Innovation.</li>
</ul>


Ecopro BM's weight has expanded to 22%. Since the probability of receiving a 15% cap is virtually 100%, it will inevitably undergo a weight change of up to nearly 7%p.
If the ongoing rally subsides before March 10th and returns to the January DTV level, the price impact could surge up to 0.3-0.4x daily for three trading days.
This seems to be a sufficient level for a shorting entry point. It may be worth considering an outright short position on Ecopro BM or Long Short with SK Innovation.


Shorting Entry Point on Ecopro BM with KODEX Battery ETF Rebalancing on March 10

<ul>
<li>For the recent conversion, the listing date is March 3rd, involving 500K shares. Despite the ongoing rally, there is a possibility of a significant price impact due to the volume.</li>
<li>We still have 1,632,333 shares to be converted. This represents 6.5% of the SO. There is a high likelihood that these will also be applied for conversion soon.</li>
<li>Assuming that it occurs in increments of 400-500K, there could be roughly 3-4 opportunities for shorting.</li>
</ul>


For the recent conversion, the listing date is March 3rd, involving 500K shares. Despite the ongoing rally, there is a possibility of a significant price impact due to the volume.
We still have 1,632,333 shares to be converted. This represents 6.5% of the SO. There is a high likelihood that these will also be applied for conversion soon.
Assuming that it occurs in increments of 400-500K, there could be roughly 3-4 opportunities for shorting.


Ecopro Co: Shorting Entry Points on CB Conversion Event

South Korea

Ecopro BM Co.,Ltd develops and manufactures advanced materials. The Company produces and sells high-nickel cathode materials and other products. Ecopro BM markets its products throughout Korea.

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Ecopro BM (247540 KS)

Flow Trading Targeting Cap Reversion in TIGER Battery ETF Rebalancing on April 13

This post investigates potential flow trading opportunities targeting those subject to a 10% cap reversion in TIGER Battery ETF's upcoming...

Sanghyun Park

Long Short Setup Candidate: Posco Holdings & Celltrion with TIGER Top 10 Rebalancing

TIGER Top 10 ETF's upcoming rebalancing, scheduled for June 9, presents a feasible long short trade setup on Posco Holdings and Celltrion.

Sanghyun Park

Initial Thoughts on the Ecopro Materials IPO

Ecopro Materials, an affiliate of Ecopro, is getting ready to complete its IPO in 2H 2023. The expected market value of Ecopro Materials is about 3...

Douglas Kim

Shorting Entry Point on Ecopro BM with KODEX Battery ETF Rebalancing on March 10

This post analyzes the potential shorting entry point for Ecopro BM in the upcoming KODEX Battery ETF rebalancing on March 10th.

Sanghyun Park

Ecopro Co: Shorting Entry Points on CB Conversion Event

This post introduces potential shorting opportunities on Ecopro Co's CB conversion event, given the high volume of shares to get listed on March 3rd.

Sanghyun Park

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