Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Bottom-Up

<ul>
<li>In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 2Q 2023.</li>
<li>Of the 38 pair trades, 21 of them involved holdcos outperforming opcos YTD and 17 of them involved opcos outperforming holdcos in the same period.</li>
<li>We highlight 38 pair trades that involve Korean holdcos and opcos.</li>
</ul>


In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 2Q 2023.
Of the 38 pair trades, 21 of them involved holdcos outperforming opcos YTD and 17 of them involved opcos outperforming holdcos in the same period.
We highlight 38 pair trades that involve Korean holdcos and opcos.


Korean Holdcos Vs Opcos Gap Trading Opportunities in 2Q 2023

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>Amorepacific Group is more likely to remain in LargeCap due to its share price surge earlier this year. Instead, Hyundai Autoever will likely face a large→mid migration.</li>
<li>Of Small→Mid migrants. Sebang and Kum Yang deserve attention, as they will rank high in the Mid due to the rapid market cap growth over the past six months.</li>
<li>YTD performance seems to have a higher correlation with individual sector performance than causality with this event. So, there is still a circumstantial probability that justifies the trade.</li>
</ul>


Amorepacific Group is more likely to remain in LargeCap due to its share price surge earlier this year. Instead, Hyundai Autoever will likely face a large→mid migration.
Of Small→Mid migrants. Sebang and Kum Yang deserve attention, as they will rank high in the Mid due to the rapid market cap growth over the past six months.
YTD performance seems to have a higher correlation with individual sector performance than causality with this event. So, there is still a circumstantial probability that justifies the trade.


KOSPI Size Index Migration: Names to Trade as We Are 30D Towards Effective

<ul>
<li>In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 1Q 2023.</li>
<li>Of the 33 pair trades, 2/3 of them involved holdcos outperforming opcos in the past year and 1/3 of them involved opcos outperforming holdcos in the same period.</li>
<li>We highlight 33 pair trades that involve Korean holdcos and opcos.</li>
</ul>


In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 1Q 2023.
Of the 33 pair trades, 2/3 of them involved holdcos outperforming opcos in the past year and 1/3 of them involved opcos outperforming holdcos in the same period.
We highlight 33 pair trades that involve Korean holdcos and opcos.


Korean Holdcos Vs Opcos Gap Spreads Opportunities in 1Q 2023

<ul>
<li>In this insight, we discuss a list of 60 stocks in Korea where NPS recently added or reduced 1% or more stake (27 adds and 33 reduce). </li>
<li>Among the stocks NPS increased its stake, many of them are clear beneficiaries of the end of zero COVID policies in China including Hotel Shilla, Amorepacific Corp, and GKL. </li>
<li>Among the top market cap stocks where the NPS decreased its stake by 1% or more, they include Lg Innotek, Hyundai E&amp;C, Hyundai Mipo, and Posco International. </li>
</ul>


In this insight, we discuss a list of 60 stocks in Korea where NPS recently added or reduced 1% or more stake (27 adds and 33 reduce). 
Among the stocks NPS increased its stake, many of them are clear beneficiaries of the end of zero COVID policies in China including Hotel Shilla, Amorepacific Corp, and GKL. 
Among the top market cap stocks where the NPS decreased its stake by 1% or more, they include Lg Innotek, Hyundai E&amp;C, Hyundai Mipo, and Posco International. 


<ul>
<li>About ₩3T trillion is presumed to flow from NPS to KOSPI MID. Then, ₩0.8T from local publicly raised funds should be sitting in KOSPI MID. Adding these two alone amounts ₩4T.</li>
<li>Of course, this is ACTIVE. In other words, they do not need to proceed with universe changes due to rebalancing at the same pace as ETFs.</li>
<li>Nevertheless, we should note that the domestic fund industry does not allow a large gap with BM. Hence, at least ₩4T of funds follow KOSPI MID quite tightly.</li>
</ul>


About ₩3T trillion is presumed to flow from NPS to KOSPI MID. Then, ₩0.8T from local publicly raised funds should be sitting in KOSPI MID. Adding these two alone amounts ₩4T.
Of course, this is ACTIVE. In other words, they do not need to proceed with universe changes due to rebalancing at the same pace as ETFs.
Nevertheless, we should note that the domestic fund industry does not allow a large gap with BM. Hence, at least ₩4T of funds follow KOSPI MID quite tightly.


Estimating Fund Size Tracking KOSPI MID Cap Index

South Korea

AMOREPACIFIC Group is an investment holding company. The Company, through its subsidiaries, produce cosmetics and toiletries.

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Amorepacific Group (002790 KS)

Korean Holdcos Vs Opcos Gap Trading Opportunities in 2Q 2023

In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 2Q 2023. We highlight 38 pair trades that...

Douglas Kim

KOSPI Size Index Migration: Names to Trade as We Are 30D Towards Effective

This post examines the names to trade for the KOSPI Size Index migration event, as we are 30 days toward the effective date.

Sanghyun Park

Korean Holdcos Vs Opcos Gap Spreads Opportunities in 1Q 2023

In this insight, we highlight the pricing gap divergences of the major Korean holdcos and opcos in 1Q 2023. We highlight 33 pair trades that...

Douglas Kim

What Is NPS Buying & Selling?

In this insight, we discuss a list of 60 stocks in Korea where NPS recently added or reduced 1% or more stake (27 adds and 33 reduce).

Douglas Kim

Estimating Fund Size Tracking KOSPI MID Cap Index

This post provides a breakdown explaining why Korea's local market estimates the fund size tracking KOSPI MID at ₩4T (at least).

Sanghyun Park

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