Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Cross Asset Strategy

<ul>
<li>We discuss two positive factors pushing greater demand for Korean preference stocks (value &amp; new government) offset by one major negative factor (market liquidity) this year. </li>
<li>The 28 common shares are on average down 17% YTD versus their preference counterparts which are down on average 17.3% YTD.</li>
<li>The sharp increases in common vs preference shares on Amorepacific Corp, Hotel Shilla, and LG H&amp;H last month may be a bit excessive and the gaps are likely to narrow.  </li>
</ul>


We discuss two positive factors pushing greater demand for Korean preference stocks (value &amp; new government) offset by one major negative factor (market liquidity) this year. 
The 28 common shares are on average down 17% YTD versus their preference counterparts which are down on average 17.3% YTD.
The sharp increases in common vs preference shares on Amorepacific Corp, Hotel Shilla, and LG H&amp;H last month may be a bit excessive and the gaps are likely to narrow.  


Korean Prefs Vs Common: Closing the Gaps on Select Stocks

Equity Bottom-Up

<ul>
<li>There were 128k visitors to South Korea in April, up 32% MoM which was the biggest jump in MoM change in visitors to South Korea in the past year.</li>
<li>There were 215k outbound people from South Korea in April 2022, up 48% MoM and up 202% YoY.</li>
<li>Among the 21 major reopening plays in Korea, we prefer certain sectors including casino related plays (GKL, Paradise, and Kangwon Land) as well as F&amp;B related (Hitejinro and CJ Cheiljedang).</li>
</ul>


There were 128k visitors to South Korea in April, up 32% MoM which was the biggest jump in MoM change in visitors to South Korea in the past year.
There were 215k outbound people from South Korea in April 2022, up 48% MoM and up 202% YoY.
Among the 21 major reopening plays in Korea, we prefer certain sectors including casino related plays (GKL, Paradise, and Kangwon Land) as well as F&amp;B related (Hitejinro and CJ Cheiljedang).


Significant MoM Increase in Inbound & Outbound Visitors in Korea in April 2022

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Quantitative Analysis

<ul>
<li>We look at short interest across Hong Kong, Japan, Korea and Taiwan in April to identify stocks/sectors that have seen the largest changes in each market.</li>
<li>Korea and Taiwan are showing a clear divergence with short notional increasing as the market moves lower, indicative of new shorts being initiated.</li>
<li>
<a href="https://www.smartkarma.com/entities/china-merchants-bank-co-ltd-3388a037-4214-4997-b45d-520518cfdb57" target="_blank" data-smartkarma-citation="entities:10987:1" rel="noopener">China Merchants Bank H (3968 HK)</a> has seen the largest short covering as the stock has tumbled in the last couple of weeks.</li>
</ul>


We look at short interest across Hong Kong, Japan, Korea and Taiwan in April to identify stocks/sectors that have seen the largest changes in each market.
Korea and Taiwan are showing a clear divergence with short notional increasing as the market moves lower, indicative of new shorts being initiated.

China Merchants Bank H (3968 HK) has seen the largest short covering as the stock has tumbled in the last couple of weeks.


Asia Short Interest: Large Moves in April

<ul>
<li>On 19 April, the US CDC stated that the national mask requirement on public transportation is no longer in effect in the United States.</li>
<li><strong>The CDC lifting the mask mandate is a key catalyst and other major countries are likely to follow the US in the coming months. </strong></li>
<li><em>Will the world likely to become more like Shanghai and enforce even greater lockdown policies or will they become more like the US and drop social distancing and mask mandates?  </em></li>
</ul>


On 19 April, the US CDC stated that the national mask requirement on public transportation is no longer in effect in the United States.
The CDC lifting the mask mandate is a key catalyst and other major countries are likely to follow the US in the coming months. 
Will the world likely to become more like Shanghai and enforce even greater lockdown policies or will they become more like the US and drop social distancing and mask mandates?  


CDC Ends Public Transportation Mask Mandate & Will the World Follow Shanghai or Vice Versa?

Thematic (Sector/Industry)

<ul>
<li>In this insight, we discuss the recent COVID-19 stats including cases, deaths, and recovery/death rates.</li>
<li>In addition, we analyze the easing of travel restrictions among major Asian countries including Australia, India, Japan, Singapore, Thailand, and South Korea. </li>
<li>More countries are treating COVID-19 not as a pandemic but as a serious flu. </li>
</ul>


In this insight, we discuss the recent COVID-19 stats including cases, deaths, and recovery/death rates.
In addition, we analyze the easing of travel restrictions among major Asian countries including Australia, India, Japan, Singapore, Thailand, and South Korea. 
More countries are treating COVID-19 not as a pandemic but as a serious flu. 


A Review of COVID-19 Cases & The Easing of Travel Restrictions in Major Asian Countries

South Korea

Amorepacific Corp. develops, manufactures, and exports skin care, make-up, and fragrance products. The Company also produces and markets personal care and health-related products, such as shampoos, soaps, toothpastes, and health teas.

Amorepacific Corp (Preferred) (090435 KS)

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Amorepacific Corp (Preferred) (090435 KS)

Korean Prefs Vs Common: Closing the Gaps on Select Stocks

We discuss two positive factors pushing greater demand for Korean preference stocks (value & new government) offset by one major negative factor...

Douglas Kim

Significant MoM Increase in Inbound & Outbound Visitors in Korea in April 2022

There were 128k visitors to South Korea in April, up 32% MoM. There were 215k outbound people from South Korea in April 2022, up 48% MoM.

Douglas Kim

Asia Short Interest: Large Moves in April

Short notional in Korea and Taiwan has been increasing as the market has been moving lower. Shorts on China Merchant Bank have been covered in...

Brian Freitas

CDC Ends Public Transportation Mask Mandate & Will the World Follow Shanghai or Vice Versa?

The CDC lifting the mask mandate is a key catalyst and other major countries are likely to follow the US in the coming months.

Douglas Kim

A Review of COVID-19 Cases & The Easing of Travel Restrictions in Major Asian Countries

We discuss the recent COVID-19 stats including cases, deaths, and recovery/death rates in major Asian countries. More countries are treating COVID...

Douglas Kim

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52-week Range

Market Cap (USDm)

P/E

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