Silver Point

Thomas J. Monaco

Independent Insight Provider

Silver Point is a boutique research firm that focuses on the broader financial services sector, with a particular focus on troubled institutions globally. 

Asia Ex Japan

Equity Bottom-Up

<ul>
<li>HKEX reported a weak set of 4Q21 earnings results of HKD 2.7 bn, declining HKD 577 mn (17.7%) linked quarter, driven by the decline in cash ADT and higher costs; </li>
<li>Derivative activity remained flattish linked quarter with contract volume at 507 thousand – despite the successful launch of the MSCI China A50 Connect (HK A50); and </li>
<li>With HIBOR set to increase, HKEx is likely to become more reliant on lower quality investment income. </li>
</ul>


HKEX reported a weak set of 4Q21 earnings results of HKD 2.7 bn, declining HKD 577 mn (17.7%) linked quarter, driven by the decline in cash ADT and higher costs; 
Derivative activity remained flattish linked quarter with contract volume at 507 thousand – despite the successful launch of the MSCI China A50 Connect (HK A50); and 
With HIBOR set to increase, HKEx is likely to become more reliant on lower quality investment income. 


Hong Kong Exchanges & Clearing – Negative Jaws

Alpha-Centric ESG Research

Kyle Rudden

<ul>
<li>Hang Seng Indexes launched two new sustainability/ESG indexes, the HSI ESG Screened Index and the HSI Low Carbon Index. Hang Seng is doing a good thing; advancing ESG in Asia.</li>
<li>Both are based on the Hang Seng Index. HSI ESG Screened Index is essentially ESG factor-tilted with a minor exclusionary screen. Straightforward, and with top ESG ratings firms behind it.</li>
<li>I do, however, have a few thoughts about the HSI Low Carbon Index. Call them observations, or experienced-based opinions, or similar. Food for thought kind of stuff, nothing critical.  </li>
</ul>


Hang Seng Indexes launched two new sustainability/ESG indexes, the HSI ESG Screened Index and the HSI Low Carbon Index. Hang Seng is doing a good thing; advancing ESG in Asia.
Both are based on the Hang Seng Index. HSI ESG Screened Index is essentially ESG factor-tilted with a minor exclusionary screen. Straightforward, and with top ESG ratings firms behind it.
I do, however, have a few thoughts about the HSI Low Carbon Index. Call them observations, or experienced-based opinions, or similar. Food for thought kind of stuff, nothing critical.  


Hang Seng's New ESG-Themed Indexes Will Help Promote ESG in Asia (Some Thoughts On the Carbon Index)

<ul>
<li>On 23 November, the International Organization of Securities Commissions (IOSCO) released a framework aimed at greater oversight and accountability of ESG ratings and data providers.</li>
<li>Generally, this is a positive for ESG investing. Implications for specific stocks, however, are still vague and depend on how regional regulators interpret and implement IOSCO's suggestions.</li>
<li>That said, one of IOSCO's concerns – conflicts of interest – could affect certain ESG ratings and data providers, especially those owned by the "Big Three" credit rating agencies.</li>
</ul>


On 23 November, the International Organization of Securities Commissions (IOSCO) released a framework aimed at greater oversight and accountability of ESG ratings and data providers.
Generally, this is a positive for ESG investing. Implications for specific stocks, however, are still vague and depend on how regional regulators interpret and implement IOSCO's suggestions.
That said, one of IOSCO's concerns – conflicts of interest – could affect certain ESG ratings and data providers, especially those owned by the "Big Three" credit rating agencies.


ESG Ratings and Data Providers Subject to Greater Oversight Under IOSCO Framework

<ul>
<li>
A50 Challenges:Hong Kong Exchange &amp; Clearing (388.HK) [HKEx] launched the MSCI China A50 Connect (HK A50). This new product competes with 20% of Singapore Exchange’s (SGX.SP) [SGX] PBT; </li>
<li>
Completely Distracted: On top of weaker equity volumes/fees and the HK A50 launch, SGX has made numerous moves which are more of a distraction than they're worth; and </li>
<li>
Time For Massive Strategic Move: SGX must consider significant strategic alternatives if it is to avoid being hollowed out over the longer-term.</li>
</ul>



A50 Challenges:Hong Kong Exchange &amp; Clearing (388.HK) [HKEx] launched the MSCI China A50 Connect (HK A50). This new product competes with 20% of Singapore Exchange’s (SGX.SP) [SGX] PBT; 

Completely Distracted: On top of weaker equity volumes/fees and the HK A50 launch, SGX has made numerous moves which are more of a distraction than they're worth; and 

Time For Massive Strategic Move: SGX must consider significant strategic alternatives if it is to avoid being hollowed out over the longer-term.


*Strong Revenue, Controlled Costs: Hong Kong Exchanges &amp; Clearing (388.HK) [HKEx] reported a strong set of 3Q21 earnings at HKD 3.3 bn, improving HKD 481 mn (17.4%) linked quarter. Results were highlighted by HKEx’ marginally positive operating jaws, as recurring revenue improved HKD 550 mn (12.1%) while overall operating expenses declined nominally (under 0.1%) to HKD 1.5 mn over the period; and*A50, A New Avenue Of Growth: On October 18, 2021, HKEx successfully launched the MSCI China A50 Connect (HK A50), which is predicated on the new MSCI A50 Index. HKEx has a very broad range of liquid Hong Kong-China linked products, with the new A50 contract being linked to the northbound Stock Connect – on top of a better fee offering.

*Strong Revenue, Controlled Costs: Hong Kong Exchanges &amp; Clearing (388.HK) [HKEx] reported a strong set of 3Q21 earnings at HKD 3.3 bn, improving HKD 481 mn (17.4%) linked quarter. Results were highlighted by HKEx’ marginally positive operating jaws, as recurring revenue improved HKD 550 mn (12.1%) while overall operating expenses declined nominally (under 0.1%) to HKD 1.5 mn over the period; and*A50, A New Avenue Of Growth: On October 18, 2021, HKEx successfully launched the MSCI China A50 Connect (HK A50), which is predicated on the new MSCI A50 Index. HKEx has a very broad range of liquid Hong Kong-China linked products, with the new A50 contract being linked to the northbound Stock Connect – on top of a better fee offering. 

Hong Kong Exchanges & Clearing – Solid Result Even Prior To A50

Germany

Deutsche Boerse AG provides a variety of stock exchange introduction, trading, and operational services to institutions and private investors. The Company offers electronic trading systems for buying and selling of securities on stock exchanges in Europe.  Deutsche Boerse offers indices such as DAX, MDAX, SDAX, and XTF, as well as trading in options and futures.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Deutsche Boerse (DB1 GR)

Hong Kong Exchanges & Clearing – Negative Jaws

HKEX: HKEX reported a fairly weak set of 4Q21 results, declining 17.7% QOQ, and driven by the overall decline in cash ADT and higher overall costs.

Thomas J. Monaco

Hang Seng's New ESG-Themed Indexes Will Help Promote ESG in Asia (Some Thoughts On the Carbon Index)

Hang Seng Indexes launched two new sustainability/ESG indexes, the HSI ESG Screened Index and HSI Low Carbon Index. Here is a quick look, and a few...

Kyle Rudden

ESG Ratings and Data Providers Subject to Greater Oversight Under IOSCO Framework

ESG ratings and data are largely unregulated, despite growing relevance to capital markets. That is why IOSCO decided it is time for greater...

Kyle Rudden

Singapore Exchange - Ringing Hollow

SGX: A50 Challenges: HKEx launched the MSCI China A50 Connect, which directly competes with 20% of SGX' PBT. A recent competitor event revealed...

Thomas J. Monaco

Hong Kong Exchanges & Clearing – Solid Result Even Prior To A50

HKEX: HKEx reported a strong QOQ 3Q21 earnings growth of 17.4%, and highlighted by marginally positive operating jaws, as recurring revenue...

Thomas J. Monaco

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)