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

SK IE Technology and LG Chem soared abruptly between 3:20 and 3:30 pm during the simultaneous bids and offers trade period. During this 10-minute period, SK IE Technology's daily gain rose from 3.51% to 10.53%. LG Chem also rose sharply from 2.97% to 5.33%.Why did this happen?The local street believes that the stock prices have moved significantly in such a short period of time as Samsung Asset Management newly added SK IE Technology to its secondary battery sector ETF and increased the weighting of LG Chem in the same ETF.Local ETFs tracking secondary battery sectorKorea currently has three ETFs specifically tracking the local secondary battery sector. The biggest one is Samsung KODEX Secondary Battery Industry ETF, mirroring the FnGuide Secondary Battery Industry Index. It now features a market cap of ₩1,233.6B with 26 constituents.The other two ETFs aren't too far behind by market cap. They are both Mirae Asset TIGER ETFs. One tracks the WISE Secondary Battery Them Index containing 26 constituents. The other one mirrors the government-initiated K-New Deal Index, which has 10 constituents.







Local secondary battery sector ETFs

Name
Samsung KODEX Secondary Battery Industry ETF
Mirae Asset TIGER Secondary Cell ETF
Mirae TIGER KRX Secondary Battery K-New Deal ETF


Ticker
305720
305540
364980


Manager
Samsung Asset Management
Mirae Asset Management
Mirae Asset Management


Market cap
₩1,233.6B
₩873.7B
₩812.8B


Underlying index
FnGuide Secondary Battery Industry Index
WISE Secondary Battery Theme Index
KRX Secondary Battery K-New Deal Index


Constituents
25
26
10

Source: KRX &amp; FnGuide Index

Portfolio Deposit File (PDF)Below is the full list of the constituents of the three ETFs with index weight as of last Friday. It seems that Samsung KODEX hasn't fully updated the constituent list of its Secondary Battery Sector Index ETF. It is presumably because most of the trades took place during the simultaneous bids and offers trade period, meaning that the trades were completed and reflected after 3:30 pm. Samsung KODEX updates the portfolio deposit file (PDF) of its ETFs at 3:30 pm of each day.










Samsung KODEX Secondary Battery Industry ETF
Weight
Mirae Asset TIGER Secondary Cell ETF
Weight
Mirae TIGER KRX Secondary Battery K-New Deal ETF
Weight


SK Innovation
17.13%
SK Innovation
11.45%
SK Innovation
26.41%


Posco Chemical
16.50%
LG Chem
9.84%
LG Chem
23.95%


LG Chem
15.96%
SKC
9.66%
Samsung SDI
22.96%


Samsung SDI
13.18%
Samsung SDI
9.21%
Posco Chemical
7.96%


Ecopro
8.35%
Posco Chemical
8.77%
SKC Co
5.22%


Ecopro HN
5.33%
Ecopro BM
6.92%
Ecopro BM
3.64%


L&amp;F
4.00%
L&amp;F
6.33%
L&amp;F
2.85%


Ecopro BM
3.94%
Iljin Materials
6.12%
Iljin Materials
2.73%


Iljin Materials
3.59%
SoulBrain
5.90%
SoulBrain
2.71%


Creative &amp; Innovative System
3.05%
Chunbo
3.14%
Chunbo
1.51%


People &amp; Technology
1.72%
Ecopro Co., Ltd.
3.06%




Foosung
1.02%
Creative &amp; Innovative System
2.49%




Cosmo Advanced Materials&amp;Technlgy
1.00%
Cosmo Advanced Materials&amp;Technlgy
2.24%




DA Technology
0.88%
Foosung
2.07%




Sang-A Frontec
0.88%
Ecopro HN
2.02%




Daejoo Electronic Materials
0.69%
Solus Advanced Materials
2.01%




Cosmo Chemical
0.42%
Daejoo Electronic Materials
1.89%




Wonik PNE
0.38%
People &amp; Technology
1.68%




mPlus
0.38%
Dongwha Enterprise
0.92%




Soulbrain Holdings
0.33%
Wonik PNE
0.91%




Philoptics
0.28%
Youlchon Chemical
0.80%




Sangsin Energy Display Precision
0.27%
CowinTech
0.71%




Shin Heung Energy &amp; Electronics
0.27%
Shin Heung Energy &amp; Electronics
0.55%




Chemtros
0.24%
mPlus
0.51%




NS
0.21%
Innometry
0.41%






Daebo Magnetic
0.27%



Source: Samsung KODEX &amp; Mirae Asset TIGER



Korea's Local Sector Index (FnGuide Secondary Battery) Rebalancing Made a Big Splash Last Friday

Pan-Asia Catalysts/Events, Quiddity Advisors

David Blennerhassett

Pan-Asia Catalysts/Events

Quiddity Advisors

<div>
<p>This week in StubWorld ...</p>
</div>
<div>
<div class="content-highlight">
<p>When a company spins off a business, wherein shares are distributed to existing shareholders on pro-rata basis, the parent company typically declines. But <a href="https://www.smartkarma.com/entities/ecopro-co-ltd" target="_blank" data-smartkarma-citation="entities:19029:1" rel="noopener">Ecopro Co Ltd (086520 KS)</a>'s 40% decline upon relisting defies logic, even for extreme Korean Holdco structures.</p>
</div>
</div>
<div>
<p>Preceding my comments on Ecopro are the weekly setup/unwind tables for Asia-Pacific Holdcos.</p>
</div>
<div><hr></div>
<div>
<p>These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.</p>
</div>


This week in StubWorld ...



When a company spins off a business, wherein shares are distributed to existing shareholders on pro-rata basis, the parent company typically declines. But Ecopro Co Ltd (086520 KS)'s 40% decline upon relisting defies logic, even for extreme Korean Holdco structures.



Preceding my comments on Ecopro are the weekly setup/unwind tables for Asia-Pacific Holdcos.



These relationships trade with a minimum liquidity threshold of US$1mn on a 90-day moving average, and a % market capitalisation threshold - the $ value of the holding/opco held, over the parent’s market capitalisation, expressed in percent - of at least 20%.


StubWorld: What Is Up (Or Down) With Ecopro Co?

South Korea

Ecopro HN Co. Ltd. operates as an environmental company. The Company provides environment engineering, environment consulting, and other related services. Ecopro Insight offers services throughout South Korea.

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Ecopro HN (383310 KS)

Korea's Local Sector Index (FnGuide Secondary Battery) Rebalancing Made a Big Splash Last Friday

The local sector index rebalancing made a huge passive flow impact on SK IE Tech last Friday, and here are the upcoming index events potentially...

Sanghyun Park

StubWorld: What Is Up (Or Down) With Ecopro Co?

The current share price of Ecopro Co appears unsubstantiated here. I would set up a Long Ecopro Co versus Short Ecopro BM.

David Blennerhassett

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