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>Trading for price gain by building a position 2-3 weeks before the dividend record date and selling it before the ex-dividend date provides better performance than directly aiming at dividends.</li>
<li>There are signs that this pattern will repeat itself this year. Already, local financial stocks have outperformed the market this month.</li>
<li>Even from now, we can consider building an outright long position on these dividend stocks in a basket and getting out before (or at) the dividend record date.</li>
</ul>


Trading for price gain by building a position 2-3 weeks before the dividend record date and selling it before the ex-dividend date provides better performance than directly aiming at dividends.
There are signs that this pattern will repeat itself this year. Already, local financial stocks have outperformed the market this month.
Even from now, we can consider building an outright long position on these dividend stocks in a basket and getting out before (or at) the dividend record date.


Korea Dividend Stocks: Yearend Trading Approach

<p>The closing date for the stock market this year is December 30 (Thursday). So, <strong>the ex-dividend date</strong> for the fourth quarter and fiscal year-end (for the December settlement companies) is <strong>December 29</strong> (Wednesday).</p><p>Among local stocks that have consistently paid dividends over the past three years, stocks with a <strong>dividend yield of 4%</strong> or higher at this point based on the FnGuide consensus DPS are as follows. Breaking down by industry, there are many financial and steel/chemical stocks in the list, which, of course, isn't surprising at all.</p><div class="content-highlight"><p>The stocks highlighted in yellow in the list below (POSCO and Shinhan Financial) are stocks that pay quarterly dividends. And the stocks highlighted in red (Hana Financial and KB Financial) pay interim dividends.</p></div><section class="figure"><section class="figure"><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/240/690/original/Screen+Shot+2021-11-09+at+9.27.33+AM.png?1636468072" class="editor-image img-responsive" data-smartkarma-image-id="240690"></figure></section></section>

The closing date for the stock market this year is December 30 (Thursday). So, the ex-dividend date for the fourth quarter and fiscal year-end (for the December settlement companies) is December 29 (Wednesday).Among local stocks that have consistently paid dividends over the past three years, stocks with a dividend yield of 4% or higher at this point based on the FnGuide consensus DPS are as follows. Breaking down by industry, there are many financial and steel/chemical stocks in the list, which, of course, isn't surprising at all.The stocks highlighted in yellow in the list below (POSCO and Shinhan Financial) are stocks that pay quarterly dividends. And the stocks highlighted in red (Hana Financial and KB Financial) pay interim dividends.

Korea Dividend Stocks: +4% Yearend Yield & +50% YoY Growth with +₩10B ADTV

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<p>Market dynamics remain healthy which suggests a new broad-based bull market is not far off. With that said, we are still waiting for confirmation in the form of breakouts or bullish price inflections on the broad global indexes (ACWI-US, ACWX-US, EFA-US, and EEM-US) in order to turn bullish.</p><ul type="disc">
<li>
<strong>Actionable Theme: Major Autos/Auto Parts. </strong>Global automobile stocks display bullish price and RS inflections with many breaking out to new highs -- add exposure... <em>see pages 3 and 5-6</em>.</li>
<li>
<strong>Actionable Theme: Financials. </strong>There continues to be a plethora of attractive Financial stocks globally, ranging from banks and insurance to financial services -- add exposure... <em>see pages 4 and 6-14</em>.</li>
</ul>

Market dynamics remain healthy which suggests a new broad-based bull market is not far off. With that said, we are still waiting for confirmation in the form of breakouts or bullish price inflections on the broad global indexes (ACWI-US, ACWX-US, EFA-US, and EEM-US) in order to turn bullish.

Actionable Theme: Major Autos/Auto Parts. Global automobile stocks display bullish price and RS inflections with many breaking out to new highs -- add exposure... see pages 3 and 5-6.

Actionable Theme: Financials. There continues to be a plethora of attractive Financial stocks globally, ranging from banks and insurance to financial services -- add exposure... see pages 4 and 6-14.


Buying Global Financials & Autos/Auto Parts

<p>Our biggest concerns have stemmed from a handful of large-cap China internet names, which have held back the MSCI EM and Hang Seng indexes. We are also getting a breakout above $93.50-93.75 on the US dollar, a concerning risk-off signal. Still, our list of concerns remains short, and our outlook remains neutral yet constructive overall.</p>

Our biggest concerns have stemmed from a handful of large-cap China internet names, which have held back the MSCI EM and Hang Seng indexes. We are also getting a breakout above $93.50-93.75 on the US dollar, a concerning risk-off signal. Still, our list of concerns remains short, and our outlook remains neutral yet constructive overall.

Global Cyclical Value Sectors Improving -- Buying Financials and Energy Names: ING Groep, Many More

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<p><strong><a href="https://www.smartkarma.com/entities/woori-financial-group-inc" target="_blank" data-smartkarma-citation="entities:27995:1" rel="noopener">Woori Financial Group (316140 KS)</a> announced that it plans a full privatization of the company by the end of 2021.</strong> Currently, Woori Financial's largest shareholder is Korea Deposit Insurance Corporation (KDIC) which has a 15.1% in the company. Korean government backed KDIC plans to sell at least 10% stake in <a href="https://m.stock.naver.com/index.html#/news/ranknews/view/018/0005034309" target="_blank" rel="noopener">Woori Financial</a> by the end of 2021.</p><div class="content-highlight">
<p>One of the positives of Woori Financial after the privatization is completed is that the new controlling shareholder may try to improve various corporate governance policies in order to boost the total shareholder returns including paying higher dividends and completing higher share buyback with cancellations. </p>
<p>With the announcement of the privatization of Woori Financial Holdings by the end of 2021, an attractive long-short trading idea in the Korean financial sector would be to go long <a href="https://www.smartkarma.com/entities/woori-financial-group-inc" target="_blank" data-smartkarma-citation="entities:27995:1" rel="noopener">Woori Financial Group (316140 KS)</a> and go short <a href="https://www.smartkarma.com/entities/kakaobank-corp" target="_blank" data-smartkarma-citation="entities:33501:1" rel="noopener">KakaoBank (323410 KS)</a>.</p>
</div>

Woori Financial Group (316140 KS) announced that it plans a full privatization of the company by the end of 2021. Currently, Woori Financial's largest shareholder is Korea Deposit Insurance Corporation (KDIC) which has a 15.1% in the company. Korean government backed KDIC plans to sell at least 10% stake in Woori Financial by the end of 2021.
One of the positives of Woori Financial after the privatization is completed is that the new controlling shareholder may try to improve various corporate governance policies in order to boost the total shareholder returns including paying higher dividends and completing higher share buyback with cancellations. 
With the announcement of the privatization of Woori Financial Holdings by the end of 2021, an attractive long-short trading idea in the Korean financial sector would be to go long Woori Financial Group (316140 KS) and go short KakaoBank (323410 KS).


Privatization of Woori Financial by the End of 2021

South Korea

Woori Financial Group Inc. provides commercial banking services. The Company offers deposit services, loan services, bill services, settlement services, credit card, international, online banking, and other related services. Woori Financial Group also operates banking and retail banking businesses.

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Woori Financial Group (316140 KS)

Korea Dividend Stocks: Yearend Trading Approach

This post lists the dividend yields of the high-dividend stocks (> 5%) in Korea at today's closing price. And it discusses yearend trading...

Sanghyun Park

Korea Dividend Stocks: +4% Yearend Yield & +50% YoY Growth with +₩10B ADTV

This post searches and filters Korea's high dividend stocks meeting the conditions of a +4% yield and a +50% YoY growth with an ADTV of ₩10B based...

Sanghyun Park

Buying Global Financials & Autos/Auto Parts

Global automobile stocks display bullish price and RS inflections with many breaking out to new highs. Financials are attractive globally, ranging...

Vermilion Research

Global Cyclical Value Sectors Improving -- Buying Financials and Energy Names: ING Groep, Many More

Continued rising rates is likely to support value Sectors moving forward (especially Financials and Energy), and it also typically indicates...

Vermilion Research

Privatization of Woori Financial by the End of 2021

Woori Financial Group announced it plans a full privatization of the company by the end of 2021. An attractive long-short trading idea would be to...

Douglas Kim

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