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

iShares MSCI Emerging Markets / Technical Analysis

<ul>
<li>In our prior EM Strategy (October 2) we discussed that as long as EEM-US is above our important line-in-the-sand at $37, we were buyers on the pullback.</li>
<li>This support level held and EEM-US now displays a bullish 3-month downtrend reversal as the DXY appears to be breaking below $105.70, all bullish signals signaling additional upside-- buy.</li>
<li>We are bullish as long as $36.50-$37 support holds on EEM-US. Our first target is $42, which is 1.5+ year resistance. Remain overweight India, and we're upgrading Poland/Greece to overweight</li>
</ul>


In our prior EM Strategy (October 2) we discussed that as long as EEM-US is above our important line-in-the-sand at $37, we were buyers on the pullback.
This support level held and EEM-US now displays a bullish 3-month downtrend reversal as the DXY appears to be breaking below $105.70, all bullish signals signaling additional upside-- buy.
We are bullish as long as $36.50-$37 support holds on EEM-US. Our first target is $42, which is 1.5+ year resistance. Remain overweight India, and we're upgrading Poland/Greece to overweight


MSCI EM Index Reversing 3-Month Downtrend -- Buy. Remain Overweight India, Upgrading Poland & Greece

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

Event-Driven

<ul>
<li>The review period for a bunch of indices ended last week though the announcement of the changes will take 4-6 weeks.</li>
<li>There are no rebalance implementations in the coming week though focus will move to the implementation of the <a href="https://www.smartkarma.com/entities/housing-development-finance" target="_blank" data-smartkarma-citation="entities:252:1" rel="noopener">HDFC Limited</a>/ <a href="https://www.smartkarma.com/entities/hdfc-bank-ltd-4b6b7a92-9087-468d-9dbe-ab169e77f014" target="_blank" data-smartkarma-citation="entities:558:1" rel="noopener">HDFC Bank</a> merger and index changes the following week.</li>
<li>There were big inflows to China focused ETF with a lot of money going into Semiconductor and Chip focused ETFs.</li>
</ul>


The review period for a bunch of indices ended last week though the announcement of the changes will take 4-6 weeks.
There are no rebalance implementations in the coming week though focus will move to the implementation of the HDFC Limited/ HDFC Bank merger and index changes the following week.
There were big inflows to China focused ETF with a lot of money going into Semiconductor and Chip focused ETFs.


Index Rebalance & ETF Flow Recap: KQ150, LQ45, PCOMP, HDFC/HDFCB, Delta Electronics, Redox IPO, AMFI

Tube Investments of India  / Event-Driven

<ul>
<li>We see 7 stocks moving from MidCap to LargeCap, 8 stocks moving from LargeCap to MidCap, 9 stocks from SmallCap to MidCap, and 10 stocks from MidCap to SmallCap.</li>
<li>The expected migrations from SmallCap to MidCap have outperformed the other migrations and some stocks have seen large price moves over the last couple of weeks.</li>
<li>Active managers would have started realigning their portfolios and that could continue for a couple of weeks. Unwind long positions into strength.</li>
</ul>


We see 7 stocks moving from MidCap to LargeCap, 8 stocks moving from LargeCap to MidCap, 9 stocks from SmallCap to MidCap, and 10 stocks from MidCap to SmallCap.
The expected migrations from SmallCap to MidCap have outperformed the other migrations and some stocks have seen large price moves over the last couple of weeks.
Active managers would have started realigning their portfolios and that could continue for a couple of weeks. Unwind long positions into strength.


AMFI Stock Reclassification Preview (June 2023): Outperformance Continues

<ul>
<li>The changes for the <a href="https://www.smartkarma.com/entities/korea-stock-exchange-kospi-200-index" target="_blank" data-smartkarma-citation="entities:26021:1" rel="noopener">KOSPI2 INDEX</a>, <a href="https://www.smartkarma.com/entities/kosdaq-150-index" target="_blank" data-smartkarma-citation="entities:31077:1" rel="noopener">KOSDAQ150 Index</a>, <a href="https://www.smartkarma.com/entities/shanghai-shenzhen-csi-300-index" target="_blank" data-smartkarma-citation="entities:22906:1" rel="noopener">CSI300 Index</a>, <a href="https://www.smartkarma.com/entities/sse-science-and-technology-innovation-board-50-index" target="_blank" data-smartkarma-citation="entities:29279:1" rel="noopener">STAR50 INDEX</a> and a bunch of other onshore China indices were implemented last week.</li>
<li>The coming week has a lot of rebalance implementations on Friday with the S&amp;P/ASX family and the MVIS family, among others.</li>
<li>AUM for the Yuanta/P-shares Taiwan Top 50 ETF (0050 TT) has continued to increase with big inflows in the last week.</li>
</ul>


The changes for the KOSPI2 INDEX, KOSDAQ150 Index, CSI300 Index, STAR50 INDEX and a bunch of other onshore China indices were implemented last week.
The coming week has a lot of rebalance implementations on Friday with the S&amp;P/ASX family and the MVIS family, among others.
AUM for the Yuanta/P-shares Taiwan Top 50 ETF (0050 TT) has continued to increase with big inflows in the last week.


Index Rebalance & ETF Flow Recap: HSCI, GDXJ, KRX New Deal, AMFI, Amman Mineral, Infratil

<ul>
<li>We see 8 stocks moving from MidCap to LargeCap, 9 stocks moving from LargeCap to MidCap, 9 stocks from SmallCap to MidCap, and 10 stocks from MidCap to SmallCap.</li>
<li>Following a strong listing, <a href="https://www.smartkarma.com/entities/mankind-pharma-ltd" target="_blank" data-smartkarma-citation="entities:36389:1" rel="noopener">Mankind Pharma (6596876Z IN)</a> should be added to the Large Cap segment of the market in July.</li>
<li>The expected migrations from SmallCap to MidCap have outperformed the other migrations by a huge margin over the last couple of months and there could be profit taking ahead.</li>
</ul>


We see 8 stocks moving from MidCap to LargeCap, 9 stocks moving from LargeCap to MidCap, 9 stocks from SmallCap to MidCap, and 10 stocks from MidCap to SmallCap.
Following a strong listing, Mankind Pharma (6596876Z IN) should be added to the Large Cap segment of the market in July.
The expected migrations from SmallCap to MidCap have outperformed the other migrations by a huge margin over the last couple of months and there could be profit taking ahead.


AMFI Stock Reclassification Preview (June 2023): Significant Outperformance

India

The Fertilisers and Chemicals Travancore Limited manufactures petrochemicals and fertilisers.  The Group's products include Ammonia, Sulphuric Acid, Phosphoric Acid, Ammonium, Urea, Caprolactam, Nitric Acid and Soda Ash.

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Fertilisers & Chem Travancr (FCT IN)

MSCI EM Index Reversing 3-Month Downtrend -- Buy. Remain Overweight India, Upgrading Poland & Greece

In our prior EM Strategy (10/2/23) we discussed that, if $EEM is above $37, we were buyers on the pullback. Support held and now EEM displays a...

Vermilion Research

Index Rebalance & ETF Flow Recap: KQ150, LQ45, PCOMP, HDFC/HDFCB, Delta Electronics, Redox IPO, AMFI

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

AMFI Stock Reclassification Preview (June 2023): Outperformance Continues

There could be 34 stocks migrating between size segments at the next reclassification. Active fund managers would have started rebalancing their...

Brian Freitas

Index Rebalance & ETF Flow Recap: HSCI, GDXJ, KRX New Deal, AMFI, Amman Mineral, Infratil

This recap highlights Insights covering Asian index rebalances (announcements/ forecasts/ IPO Fast Entry/ M&A driven changes). We also highlight...

Brian Freitas

AMFI Stock Reclassification Preview (June 2023): Significant Outperformance

With the review period nearing completion, there are a lot of migrations between size segments. SmallCap to MidCap migrations have outperformed....

Brian Freitas

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