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

<h2>Rebalancing results</h2><p>Below is the official result of the regular rebalancing in September for the KRX BBIG K_New Deal Index.</p><div class="content-highlight"><p><strong>Of course, the big changes are Krafton and SK Bioscience in the main index. And SKIET's inclusion in the Secondary Battery sub-index also deserves special attention.</strong></p></div><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="5" data-sheets-value='{"1":2,"2":"Constituents Change of KRX BBIG K-New Deal Index"}'>Constituents Change of KRX BBIG K-New Deal Index</td></tr>
<tr>
<td rowspan="2" data-sheets-value='{"1":2,"2":"Index"}'><div>Index</div></td>
<td colspan="2" style="text-align: center;" data-sheets-value='{"1":2,"2":"Addition"}'>Addition</td>
<td colspan="2" style="text-align: center;" data-sheets-value='{"1":2,"2":"Deletion"}'>Deletion</td>
</tr>
<tr>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
</tr>
<tr>
<td rowspan="2" data-sheets-value='{"1":2,"2":"KRX BBIG K_New Deal Index"}'><div><strong>KRX BBIG K_New Deal</strong></div></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"302440"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula='="302440"'><strong>302440</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"SK Bioscience Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><strong>SK Bioscience</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"302440"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula='="302440"'><strong>302440</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"SK Bioscience Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><div><div><strong>SK Biopharm</strong></div></div></td>
</tr>
<tr>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"259960"}' data-sheets-formula='="259960"'><strong>259960</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Krafton Inc"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><strong>Krafton</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"293490"}' data-sheets-formula='="293490"'><strong>293490</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Kakao Games Corp"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><div><div><strong>Kakao Games</strong></div></div></td>
</tr>
<tr>
<td><div></div></td>
<td colspan="4" style="text-align: left;"><div><div></div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX Secondary Battery K_New Deal Index"}'><strong>KRX Secondary Battery</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"361610"}' data-sheets-formula='="361610"'><strong>361610</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"SK IE Technology Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><strong>SK IE Technology</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"278280"}' data-sheets-formula='="278280"'><strong>278280</strong></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Chunbo Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><strong>Chunbo</strong></td>
</tr>
<tr>
<td rowspan="2" data-sheets-value='{"1":2,"2":"KRX Bio K_New Deal Index"}'><div>KRX Bio</div></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"302440"}' data-sheets-numberformat='[null,2,"₩#,##0.0B"]' data-sheets-formula='="302440"'>302440</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"SK Bioscience Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>SK Bioscience</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"019170"}' data-sheets-formula='="019170"'>019170</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Shinpoong Pharmaceutical Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><div><div>Shinpoong Pharm</div></div></td>
</tr>
<tr>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"128940"}' data-sheets-formula='="128940"'>128940</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"HanmiPharm"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>HanmiPharm</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"096530"}' data-sheets-formula='="096530"'>096530</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Seegene Inc"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>Seegene</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX Internet K_New Deal Index"}'>KRX Internet</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"035600"}' data-sheets-formula='="035600"'>035600</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"KGInicis Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>KGInicis</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"131370"}' data-sheets-formula='="131370"'>131370</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Rsupport Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'><div><div>Rsupport</div></div></td>
</tr>
<tr>
<td rowspan="2" data-sheets-value='{"1":2,"2":"KRX Game K_New Deal Index"}'><div>KRX Game</div></td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"259960"}' data-sheets-formula='="259960"'>259960</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Krafton Inc"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>Krafton</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"112040"}' data-sheets-formula='="112040"'>112040</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Wemade Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>Wemade</td>
</tr>
<tr>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"194480"}' data-sheets-formula='="194480"'>194480</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Devsisters Corp"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>Devsisters</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"217270"}' data-sheets-formula='="217270"'>217270</td>
<td style="text-align: left;" data-sheets-value='{"1":2,"2":"Neptune Co"}' data-sheets-formula='=googlefinance(R[0]C[-1], "name")'>Neptune</td>
</tr>
<tr><td colspan="5" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table><p><strong>The effective date is September 10, the same as the KOSPI 200 Fast Entry rebalancing. It means that Krafton will receive passive inflow from both KRX BBIG and KOSPI 200.</strong></p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" style="width: 746.008px;" data-sheets-value='{"1":2,"2":"Rebalancing schedule"}'>Rebalancing schedule</td></tr>
<tr>
<td style="width: 212.997px;" data-sheets-value='{"1":2,"2":"Rebalancing cycle"}'>Rebalancing cycle</td>
<td style="width: 533.011px;" data-sheets-value='{"1":2,"2":"Semi-annually"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'>Semi-annually</td>
</tr>
<tr>
<td style="width: 212.997px;" data-sheets-value='{"1":2,"2":"Rebalancing month"}'>Rebalancing month</td>
<td style="width: 533.011px;" data-sheets-value='{"1":2,"2":"March and September"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'><div>March and September</div></td>
</tr>
<tr>
<td style="width: 212.997px;" data-sheets-value='{"1":2,"2":"Implementation date"}'>Implementation date</td>
<td style="width: 533.011px;" data-sheets-value='{"1":2,"2":"The trading day following the last trading day for KOSPI 200 futures contracts"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'><div>The trading day following the last trading day for KOSPI 200 futures contracts</div></td>
</tr>
<tr>
<td style="width: 212.997px;" data-sheets-value='{"1":2,"2":"Next implementation date"}'>Next implementation date</td>
<td style="width: 533.011px;" data-sheets-value='{"1":2,"2":"September 10, 2021"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'><div>September 10, 2021</div></td>
</tr>
<tr>
<td style="width: 212.997px;" data-sheets-value='{"1":2,"2":"Rebalancing trading"}'>Rebalancing trading</td>
<td style="width: 533.011px;" data-sheets-value='{"1":2,"2":"At the close on September 9, 2021"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'><div>At the close on September 9, 2021</div></td>
</tr>
<tr>
<td style="width: 212.997px;" data-sheets-value='{"1":2,"2":"Screening base date"}'>Screening base date</td>
<td style="width: 533.011px;" data-sheets-value='{"1":2,"2":"The last trading day of the month preceding the date of regular rebalancing"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'><div>The last trading day of the month preceding the date of regular rebalancing.</div></td>
</tr>
<tr>
<td style="width: 212.997px;" data-sheets-value='{"1":2,"2":"Screening period"}'>Screening period</td>
<td style="width: 533.011px;" data-sheets-value='{"1":2,"2":"The three months preceding the screening base date"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'><div>The three months preceding the screening base date</div></td>
</tr>
<tr><td colspan="2" rowspan="1" style="width: 746.008px;" data-sheets-value='{"1":2,"2":"Source: KRX &amp; WISE Index"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'>Source: KRX &amp; WISE Index</td></tr>
</tbody>
</table><p>Below are the AUMs of the ETFs tracking these indices. Only the main index and the secondary battery sub-index have a meaningful size of AUM. And both indices' AUMs have decreased from the peak in the first half of this year.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"ETFs tracking BBIG indices"}'>ETFs tracking BBIG indices</td>
<td data-sheets-value='{"1":2,"2":"Index"}'>Index</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"AUM"}'>AUM</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Mirae Asset TIGER KRX BBIG K-New Deal ETF"}' data-sheets-formula='=googlefinance(R[0]C[2], "name")'>Mirae Asset TIGER KRX BBIG K-New Deal ETF</td>
<td rowspan="4" data-sheets-value='{"1":2,"2":"KRX BBIG K-New Deal Index"}'><div><strong>KRX BBIG K-New Deal Index</strong></div></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":364960}'>364960</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":441.35}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[0]C[1]*R[0]C[2]/1000000000">₩441.4B</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Hana Financial Investment Hana KRX BBIG K-New Deal ETN 3"}' data-sheets-formula='=googlefinance(R[0]C[2], "name")'>Hana Financial Investment Hana KRX BBIG K-New Deal ETN 3</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":700003}'>700003</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":10.31}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[0]C[1]*R[0]C[2]/1000000000">₩10.3B</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"TIMEFOLIO TIMEFOLIO BBIG Active ETF"}' data-sheets-formula='=googlefinance(R[0]C[2], "name")'>TIMEFOLIO TIMEFOLIO BBIG Active ETF</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":385710}'>385710</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":27.564}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[0]C[1]*R[0]C[2]/1000000000">₩27.6B</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"- Total"}' data-sheets-numberformat='[null,2,"#,##0.00",1]'><strong>- Total</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":479.22400000000005}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=sum(R[-3]C[0]:R[-1]C[0])"><strong>₩479.2B</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Mirae Asset TIGER KRX Second Battery K-NewDeal ETF"}' data-sheets-formula='=googlefinance(R[0]C[2], "name")'>Mirae Asset TIGER KRX Second Battery K-NewDeal ETF</td>
<td data-sheets-value='{"1":2,"2":"KRX Secondary Battery K-New Deal Index"}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>KRX Secondary Battery K-New Deal Index</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":364980}'>364980</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":647.235}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[0]C[1]*R[0]C[2]/1000000000"><strong>₩647.2B</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Mirae Asset TIGER KRX BIO K-New Deal ETF"}' data-sheets-formula='=googlefinance(R[0]C[2], "name")'>Mirae Asset TIGER KRX BIO K-New Deal ETF</td>
<td data-sheets-value='{"1":2,"2":"KRX Bio K-New Deal Index"}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>KRX Bio K-New Deal Index</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":364970}'>364970</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":100.53}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[0]C[1]*R[0]C[2]/1000000000"><strong>₩100.5B</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Mirae Asset TIGER KRX Internet K-New Deal ETF"}' data-sheets-formula='=googlefinance(R[0]C[2], "name")'>Mirae Asset TIGER KRX Internet K-New Deal ETF</td>
<td data-sheets-value='{"1":2,"2":"KRX Internet K-New Deal Index"}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>KRX Internet K-New Deal Index</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":365000}'>365000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":64.86725}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[0]C[1]*R[0]C[2]/1000000000"><strong>₩64.9B</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Mirae Asset TIGER KRX Game K-New Deal ETF"}' data-sheets-formula='=googlefinance(R[0]C[2], "name")'>Mirae Asset TIGER KRX Game K-New Deal ETF</td>
<td data-sheets-value='{"1":2,"2":"KRX Game K-New Deal Index"}' data-sheets-numberformat='[null,2,"#,##0.0"]'><strong>KRX Game K-New Deal Index</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":364990}'>364990</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":31.89275}' data-sheets-numberformat='[null,2,"₩#,##0.0B",1]' data-sheets-formula="=R[0]C[1]*R[0]C[2]/1000000000"><strong>₩31.9B</strong></td>
</tr>
<tr><td colspan="4">Source: KRX</td></tr>
</tbody>
</table><hr><h2>Regarding Krafton's inclusion:</h2><p>Krafton was listed after the review cutoff date (July 31). Nonetheless, KRX decided to include it in this rebalancing. Then, did KRX break its own rule? Well, it did not.</p><p><strong>Here is my explanation which I posted previously, concerning this issue.</strong></p><div class="content-highlight">
<p>First of all, this BBIG index does not have a Fast Entry clause. So, KRX was internally debating whether to apply the review cutoff date to newly listed stocks with large market caps. (This was what I heard from KRX directly.) Since this index has few constituents, if newly listed stocks with large market caps are excluded from the index for nearly six months, the resulting disparity between the index and the actual sector may become too large, and KRX is also concerned about this.</p>
<p>Therefore, KRX said that it would decide on Fast Entry of those stocks with large market caps, such as Krafton, Kakao Pay, and LG Energy Solution, at the time of regular rebalancing in consultation with the ETF operators (Mirae Asset). In the end, it turned out that the outcome of the KRX &amp; Mirae Asset discussion on the Fast Entry of Krafton was Go, which wasn't outside the scope of the KRX Index methodology at all.</p>
</div>

Rebalancing resultsBelow is the official result of the regular rebalancing in September for the KRX BBIG K_New Deal Index.Of course, the big changes are Krafton and SK Bioscience in the main index. And SKIET's inclusion in the Secondary Battery sub-index also deserves special attention.








Constituents Change of KRX BBIG K-New Deal Index

Index
Addition
Deletion


Ticker
Name
Ticker
Name


KRX BBIG K_New Deal
302440
SK Bioscience
302440
SK Biopharm


259960
Krafton
293490
Kakao Games






KRX Secondary Battery
361610
SK IE Technology
278280
Chunbo


KRX Bio
302440
SK Bioscience
019170
Shinpoong Pharm


128940
HanmiPharm
096530
Seegene


KRX Internet
035600
KGInicis
131370
Rsupport


KRX Game
259960
Krafton
112040
Wemade


194480
Devsisters
217270
Neptune

Source: KRX

The effective date is September 10, the same as the KOSPI 200 Fast Entry rebalancing. It means that Krafton will receive passive inflow from both KRX BBIG and KOSPI 200.





Rebalancing schedule

Rebalancing cycle
Semi-annually


Rebalancing month
March and September


Implementation date
The trading day following the last trading day for KOSPI 200 futures contracts


Next implementation date
September 10, 2021


Rebalancing trading
At the close on September 9, 2021


Screening base date
The last trading day of the month preceding the date of regular rebalancing.


Screening period
The three months preceding the screening base date

Source: KRX &amp; WISE Index

Below are the AUMs of the ETFs tracking these indices. Only the main index and the secondary battery sub-index have a meaningful size of AUM. And both indices' AUMs have decreased from the peak in the first half of this year.








ETFs tracking BBIG indices
Index
Ticker
AUM


Mirae Asset TIGER KRX BBIG K-New Deal ETF
KRX BBIG K-New Deal Index
364960
₩441.4B


Hana Financial Investment Hana KRX BBIG K-New Deal ETN 3
700003
₩10.3B


TIMEFOLIO TIMEFOLIO BBIG Active ETF
385710
₩27.6B


- Total
-
₩479.2B


Mirae Asset TIGER KRX Second Battery K-NewDeal ETF
KRX Secondary Battery K-New Deal Index
364980
₩647.2B


Mirae Asset TIGER KRX BIO K-New Deal ETF
KRX Bio K-New Deal Index
364970
₩100.5B


Mirae Asset TIGER KRX Internet K-New Deal ETF
KRX Internet K-New Deal Index
365000
₩64.9B


Mirae Asset TIGER KRX Game K-New Deal ETF
KRX Game K-New Deal Index
364990
₩31.9B

Source: KRX

Regarding Krafton's inclusion:Krafton was listed after the review cutoff date (July 31). Nonetheless, KRX decided to include it in this rebalancing. Then, did KRX break its own rule? Well, it did not.Here is my explanation which I posted previously, concerning this issue.
First of all, this BBIG index does not have a Fast Entry clause. So, KRX was internally debating whether to apply the review cutoff date to newly listed stocks with large market caps. (This was what I heard from KRX directly.) Since this index has few constituents, if newly listed stocks with large market caps are excluded from the index for nearly six months, the resulting disparity between the index and the actual sector may become too large, and KRX is also concerned about this.
Therefore, KRX said that it would decide on Fast Entry of those stocks with large market caps, such as Krafton, Kakao Pay, and LG Energy Solution, at the time of regular rebalancing in consultation with the ETF operators (Mirae Asset). In the end, it turned out that the outcome of the KRX &amp; Mirae Asset discussion on the Fast Entry of Krafton was Go, which wasn't outside the scope of the KRX Index methodology at all.


KRX BBIG Rebalancing Results & Passive Impact Estimations: Watch Douzone Bizon

<p>KRX officially announced the KOSPI 200 Fast Entry results of Kakao Bank and Krafton. KRX also announced the changes of KOSPI sector indices accordingly.</p><div class="content-highlight"><p><strong>The effective date is September 10th, so the rebalancing trading should occur at the close on September 9th.</strong></p></div><hr><h2>1. Kakao Bank in and Lock&amp;Lock out</h2><p>Below are the changes following the inclusion of Kakao Bank's index. As expected, Lock&amp;Lock (115390) was removed from the KOSPI 200. Lock&amp;Lock was one of the two stocks with the lowest daily average market cap during the most recent rebalancing review period, from November 1 of last year to April 30. Another thing worth noting is that the stock excluded from the KOSPI 100 is Ottogi (007310).</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Kakao Bank"}'>Kakao Bank</td>
<td data-sheets-value='{"1":2,"2":"Add"}'>Add</td>
<td data-sheets-value='{"1":2,"2":"Delete"}'>Delete</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200"}'><strong>KOSPI 200</strong></td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'><strong>KakaoBank (323410)</strong></td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'><strong>L&amp;L (115390)</strong></td>
</tr>
<tr><td colspan="3"><strong> </strong></td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Financials"}'>KOSPI 200 Financials</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Consumer discretionary"}'>KOSPI 200 Consumer discretionary</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 MidSmallCap"}'>KOSPI 200 MidSmallCap</td>
<td data-sheets-value='{"1":2,"2":"OTTOGI (007310)"}'>OTTOGI (007310)</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI ex-KOSPI 200"}'>KOSPI ex-KOSPI 200</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'><div><div>KakaoBank (323410)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 ex-TOP"}'>KOSPI 200 ex-TOP</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt Momentum"}'>KOSPI 200 Factor Tilt Momentum</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt LowVol"}'>KOSPI 200 Factor Tilt LowVol</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt Value"}'>KOSPI 200 Factor Tilt Value</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt Quality"}'>KOSPI 200 Factor Tilt Quality</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 GIVI"}'>KOSPI 200 GIVI</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Climate Change"}'>KOSPI 200 Climate Change</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"L&amp;L (115390)"}'>L&amp;L (115390)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 100"}'><strong>KOSPI 100</strong></td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'><strong>KakaoBank (323410)</strong></td>
<td data-sheets-value='{"1":2,"2":"OTTOGI (007310)"}'><div><div><strong>OTTOGI (007310)</strong></div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 50"}'>KOSPI 50</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"COWAY (021240)"}'><div><div>COWAY (021240)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX 300"}'>KRX 300</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX 300 Financials"}'>KRX 300 Financials</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX Bank"}'>KRX Bank</td>
<td data-sheets-value='{"1":2,"2":"KakaoBank (323410)"}'>KakaoBank (323410)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr><td colspan="3" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table><h2>2. Krafton in &amp; JW Pharma out</h2><p>Krafton is included in the KOSPI 200 through Fast Entry, replacing JW Pharma (001060). This is also an expected result. This is because JW Pharma, along with Lock&amp;Lock, was the stock with the lowest daily average market cap during the last rebalancing review period. And the stock excluded from the KOSPI 100 is Posco International (047050).</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Krafton"}'>Krafton</td>
<td data-sheets-value='{"1":2,"2":"Add"}'>Add</td>
<td data-sheets-value='{"1":2,"2":"Delete"}'>Delete</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200"}'><strong>KOSPI 200</strong></td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'><strong>KRAFTON (259960)</strong></td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div><strong>JWPHARMA (001060)</strong></div></div></td>
</tr>
<tr><td colspan="3"><div><div><strong> </strong></div></div></td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Communication Service"}'>KOSPI 200 Communication Service</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Health Care"}'>KOSPI 200 Health Care</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 MidSmallCap"}'>KOSPI 200 MidSmallCap</td>
<td data-sheets-value='{"1":2,"2":"POSCO INTERNATIONAL (047050)"}'>POSCO INTERNATIONAL (047050)</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI ex-KOSPI 200"}'>KOSPI ex-KOSPI 200</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'>JWPHARMA (001060)</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'><div><div>KRAFTON (259960)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 ex-TOP"}'>KOSPI 200 ex-TOP</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt Momentum"}'>KOSPI 200 Factor Tilt Momentum</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt LowVol"}'>KOSPI 200 Factor Tilt LowVol</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt Value"}'>KOSPI 200 Factor Tilt Value</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Factor Tilt Quality"}'>KOSPI 200 Factor Tilt Quality</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Consumer Goods"}'>KOSPI 200 Consumer Goods</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Low Volatility High Dividend Index"}'>KOSPI 200 Low Volatility High Div Index</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 GIVI"}'>KOSPI 200 GIVI</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 200 Climate Change"}'>KOSPI 200 Climate Change</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
<td data-sheets-value='{"1":2,"2":"JWPHARMA (001060)"}'><div><div>JWPHARMA (001060)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 100"}'><strong>KOSPI 100</strong></td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'><strong>KRAFTON (259960)</strong></td>
<td data-sheets-value='{"1":2,"2":"POSCO INTERNATIONAL (047050)"}'><div><div><strong>POSCO INTERNATIONAL (047050)</strong></div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KOSPI 50"}'>KOSPI 50</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"Kangwonland (035250)"}'><div><div>Kangwonland (035250)</div></div></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX 300"}'>KRX 300</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX 300 Communication Service"}'>KRX 300 Communication Service</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"KRX Media &amp; Entertainment"}'>KRX Media &amp; Entertainment</td>
<td data-sheets-value='{"1":2,"2":"KRAFTON (259960)"}'>KRAFTON (259960)</td>
<td data-sheets-value='{"1":2,"2":"None"}'>None</td>
</tr>
<tr><td colspan="3" data-sheets-value='{"1":2,"2":"Source: KRX"}'>Source: KRX</td></tr>
</tbody>
</table>

KRX officially announced the KOSPI 200 Fast Entry results of Kakao Bank and Krafton. KRX also announced the changes of KOSPI sector indices accordingly.The effective date is September 10th, so the rebalancing trading should occur at the close on September 9th.1. Kakao Bank in and Lock&amp;Lock outBelow are the changes following the inclusion of Kakao Bank's index. As expected, Lock&amp;Lock (115390) was removed from the KOSPI 200. Lock&amp;Lock was one of the two stocks with the lowest daily average market cap during the most recent rebalancing review period, from November 1 of last year to April 30. Another thing worth noting is that the stock excluded from the KOSPI 100 is Ottogi (007310).







Kakao Bank
Add
Delete


KOSPI 200
KakaoBank (323410)
L&amp;L (115390)

 

KOSPI 200 Financials
KakaoBank (323410)
None


KOSPI 200 Consumer discretionary
None
L&amp;L (115390)


KOSPI 200 MidSmallCap
OTTOGI (007310)
L&amp;L (115390)


KOSPI ex-KOSPI 200
L&amp;L (115390)
KakaoBank (323410)


KOSPI 200 ex-TOP
KakaoBank (323410)
L&amp;L (115390)


KOSPI 200 Factor Tilt Momentum
KakaoBank (323410)
None


KOSPI 200 Factor Tilt LowVol
KakaoBank (323410)
L&amp;L (115390)


KOSPI 200 Factor Tilt Value
KakaoBank (323410)
None


KOSPI 200 Factor Tilt Quality
KakaoBank (323410)
L&amp;L (115390)


KOSPI 200 GIVI
None
L&amp;L (115390)


KOSPI 200 Climate Change
None
L&amp;L (115390)


KOSPI 100
KakaoBank (323410)
OTTOGI (007310)


KOSPI 50
KakaoBank (323410)
COWAY (021240)


KRX 300
KakaoBank (323410)
None


KRX 300 Financials
KakaoBank (323410)
None


KRX Bank
KakaoBank (323410)
None

Source: KRX

2. Krafton in &amp; JW Pharma outKrafton is included in the KOSPI 200 through Fast Entry, replacing JW Pharma (001060). This is also an expected result. This is because JW Pharma, along with Lock&amp;Lock, was the stock with the lowest daily average market cap during the last rebalancing review period. And the stock excluded from the KOSPI 100 is Posco International (047050).







Krafton
Add
Delete


KOSPI 200
KRAFTON (259960)
JWPHARMA (001060)

 

KOSPI 200 Communication Service
KRAFTON (259960)
None


KOSPI 200 Health Care
None
JWPHARMA (001060)


KOSPI 200 MidSmallCap
POSCO INTERNATIONAL (047050)
JWPHARMA (001060)


KOSPI ex-KOSPI 200
JWPHARMA (001060)
KRAFTON (259960)


KOSPI 200 ex-TOP
KRAFTON (259960)
JWPHARMA (001060)


KOSPI 200 Factor Tilt Momentum
KRAFTON (259960)
None


KOSPI 200 Factor Tilt LowVol
KRAFTON (259960)
JWPHARMA (001060)


KOSPI 200 Factor Tilt Value
KRAFTON (259960)
None


KOSPI 200 Factor Tilt Quality
KRAFTON (259960)
None


KOSPI 200 Consumer Goods
None
JWPHARMA (001060)


KOSPI 200 Low Volatility High Div Index
None
JWPHARMA (001060)


KOSPI 200 GIVI
None
JWPHARMA (001060)


KOSPI 200 Climate Change
None
JWPHARMA (001060)


KOSPI 100
KRAFTON (259960)
POSCO INTERNATIONAL (047050)


KOSPI 50
KRAFTON (259960)
Kangwonland (035250)


KRX 300
KRAFTON (259960)
None


KRX 300 Communication Service
KRAFTON (259960)
None


KRX Media &amp; Entertainment
KRAFTON (259960)
None

Source: KRX



KOSPI 200 September Rebalancing Results & Passive Impact Estimations

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

<p>Last evening post market close, KRX announced the Fast Entry of <a href="https://www.smartkarma.com/entities/kakaobank-corp" target="_blank" data-smartkarma-citation="entities:33501:1" rel="noopener">KakaoBank (323410 KS)</a> and <a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a> to the <a href="https://www.smartkarma.com/entities/korea-stock-exchange-kospi-200-index" target="_blank" data-smartkarma-citation="entities:26021:1" rel="noopener">Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX)</a> at the close of trading on 9 September.</p><p>As expected, <a href="https://www.smartkarma.com/entities/lock-lock-co-ltd" target="_blank" data-smartkarma-citation="entities:4739:1" rel="noopener">Lock&amp;Lock (115390 KS)</a> and <a href="https://www.smartkarma.com/entities/jw-pharmaceutical-corp" target="_blank" data-smartkarma-citation="entities:18784:1" rel="noopener">Jw Pharmaceutical (001060 KS)</a> will be deleted from the index.</p><p>Given the rapidly shrinking volumes in <a href="https://www.smartkarma.com/entities/kakaobank-corp" target="_blank" data-smartkarma-citation="entities:33501:1" rel="noopener">KakaoBank (323410 KS)</a> and <a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a>, the impact of passive buying will be larger than what the headline numbers indicate.</p><p>The deletions were expected, the stocks have sold off from their highs, some shorts have been built, and they will no longer be short sell eligible from 10 September. Expect the stocks to move lower and then for short covering to begin as borrow is recalled.</p><p>Local institutions have been big buyers on both inclusions since listing. If part of this buying is for their passive tracking baskets, there could be less buying from now to implementation and the stocks may trade weak closer to rebalance day.</p><p>With the <a href="https://www.smartkarma.com/entities/kakao-pay-corp" target="_blank" data-smartkarma-citation="entities:29675:1" rel="noopener">Kakao Pay (377300 KS)</a> IPO back on the table, investors could look to switch out of <a href="https://www.smartkarma.com/entities/kakaobank-corp" target="_blank" data-smartkarma-citation="entities:33501:1" rel="noopener">KakaoBank (323410 KS)</a> while the changing gaming rules and regulations in China could be a dampener for <a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a>.</p>

Last evening post market close, KRX announced the Fast Entry of KakaoBank (323410 KS) and  Krafton Inc (259960 KS) to the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) at the close of trading on 9 September.As expected, Lock&amp;Lock (115390 KS) and Jw Pharmaceutical (001060 KS) will be deleted from the index.Given the rapidly shrinking volumes in KakaoBank (323410 KS) and  Krafton Inc (259960 KS), the impact of passive buying will be larger than what the headline numbers indicate.The deletions were expected, the stocks have sold off from their highs, some shorts have been built, and they will no longer be short sell eligible from 10 September. Expect the stocks to move lower and then for short covering to begin as borrow is recalled.Local institutions have been big buyers on both inclusions since listing. If part of this buying is for their passive tracking baskets, there could be less buying from now to implementation and the stocks may trade weak closer to rebalance day.With the Kakao Pay (377300 KS) IPO back on the table, investors could look to switch out of KakaoBank (323410 KS) while the changing gaming rules and regulations in China could be a dampener for  Krafton Inc (259960 KS).

KOSPI200 September Index Rebalance: Krafton, Kakao Bank Fast Entry Confirmed

<p>The KRX has announced the results of the September review of the BBIG indices and the changes will become effective after the close of trading on 9 September.</p><p>These are the changes to the indices:</p><ul style="list-style-type: disc;">
<li>Secondary Battery ETF: <a href="https://www.smartkarma.com/entities/sk-ie-technology" target="_blank" data-smartkarma-citation="entities:29207:1" rel="noopener">SK IE Technology (361610 KS)</a> replaces <a href="https://www.smartkarma.com/entities/chunbo-co-ltd" target="_blank" data-smartkarma-citation="entities:27848:1" rel="noopener">Chunbo Co Ltd (278280 KS)</a>
</li>
<li>Bio ETF: <a href="https://www.smartkarma.com/entities/sk-bioscience-co-ltd" target="_blank" data-smartkarma-citation="entities:31484:1" rel="noopener">SK Bioscience (302440 KS)</a> and <a href="https://www.smartkarma.com/entities/hanmi-pharm-co-ltd" target="_blank" data-smartkarma-citation="entities:12476:1" rel="noopener">Hanmi Pharm (128940 KS)</a> join the index, replacing <a href="https://www.smartkarma.com/entities/shinpoong-pharmaceutical-co-ltd" target="_blank" data-smartkarma-citation="entities:7296:1" rel="noopener">Shinpoong Pharmaceutical (019170 KS)</a> and <a href="https://www.smartkarma.com/entities/seegene-inc" target="_blank" data-smartkarma-citation="entities:11483:1" rel="noopener">Seegene Inc (096530 KS)</a>. Additionally, <a href="https://www.smartkarma.com/entities/sk-bioscience-co-ltd" target="_blank" data-smartkarma-citation="entities:31484:1" rel="noopener">SK Bioscience (302440 KS)</a> replaces <a href="https://www.smartkarma.com/entities/sk-biopharmaceuticals-co-ltd" target="_blank" data-smartkarma-citation="entities:28966:1" rel="noopener">SK Biopharmaceuticals Co Ltd (326030 KS)</a> in the top 3 stocks.</li>
<li>Internet ETF: <a href="https://www.smartkarma.com/entities/kg-inicis-co-ltd" target="_blank" data-smartkarma-citation="entities:5234:1" rel="noopener">KG Inicis Co Ltd (035600 KS)</a> replaces <a href="https://www.smartkarma.com/entities/rsupport-co-ltd" target="_blank" data-smartkarma-citation="entities:14783:1" rel="noopener">Rsupport Co Ltd (131370 KS)</a> </li>
<li>Game ETF: <a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a> and <a href="https://www.smartkarma.com/entities/devsisters-co-ltd" target="_blank" data-smartkarma-citation="entities:14096:1" rel="noopener">Devsisters (194480 KS)</a> replace <a href="https://www.smartkarma.com/entities/wemade-co-ltd" target="_blank" data-smartkarma-citation="entities:9940:1" rel="noopener">Wemade Co., Ltd. (112040 KS)</a> and <a href="https://www.smartkarma.com/entities/neptune-company" target="_blank" data-smartkarma-citation="entities:28826:1" rel="noopener">Neptune Company (217270 KS)</a>
</li>
<li>BBIG ETF: <a href="https://www.smartkarma.com/entities/sk-bioscience-co-ltd" target="_blank" data-smartkarma-citation="entities:31484:1" rel="noopener">SK Bioscience (302440 KS)</a> and <a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a> replace <a href="https://www.smartkarma.com/entities/sk-biopharmaceuticals-co-ltd" target="_blank" data-smartkarma-citation="entities:28966:1" rel="noopener">SK Biopharmaceuticals Co Ltd (326030 KS)</a> and <a href="https://www.smartkarma.com/entities/kakao-games-corp" target="_blank" data-smartkarma-citation="entities:26730:1" rel="noopener">Kakao Games Corp (293490 KS)</a>.</li>
</ul><p>KRX has broken its own rules (everyone does it, so join in!) by including <a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a> even though the stock listed post the July-end cut off and there is no provision of Fast Entry in the index methodology.</p><p>Stocks with the largest inflows are <a href="https://www.smartkarma.com/entities/sk-bioscience-co-ltd" target="_blank" data-smartkarma-citation="entities:31484:1" rel="noopener">SK Bioscience (302440 KS)</a>, <a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a>, <a href="https://www.smartkarma.com/entities/sk-ie-technology" target="_blank" data-smartkarma-citation="entities:29207:1" rel="noopener">SK IE Technology (361610 KS)</a>, <a href="https://www.smartkarma.com/entities/lg-chem-ltd" target="_blank" data-smartkarma-citation="entities:3583:1" rel="noopener">LG Chem Ltd (051910 KS)</a>, <a href="https://www.smartkarma.com/entities/sk-innovation-co-ltd" target="_blank" data-smartkarma-citation="entities:1268:1" rel="noopener">SK Innovation (096770 KS)</a> and <a href="https://www.smartkarma.com/entities/douzone-bizon-co-ltd" target="_blank" data-smartkarma-citation="entities:20161:1" rel="noopener">Douzone Bizon (012510 KS)</a> while the stocks with the largest outflows are <a href="https://www.smartkarma.com/entities/kakao-games-corp" target="_blank" data-smartkarma-citation="entities:26730:1" rel="noopener">Kakao Games Corp (293490 KS)</a>, <a href="https://www.smartkarma.com/entities/sk-biopharmaceuticals-co-ltd" target="_blank" data-smartkarma-citation="entities:28966:1" rel="noopener">SK Biopharmaceuticals Co Ltd (326030 KS)</a>, <a href="https://www.smartkarma.com/entities/kakao-corp" target="_blank" data-smartkarma-citation="entities:15002:1" rel="noopener">Kakao Corp (035720 KS)</a>, <a href="https://www.smartkarma.com/entities/posco-chemical-co-ltd" target="_blank" data-smartkarma-citation="entities:12421:1" rel="noopener">Posco Chemical Co Ltd (003670 KS)</a>, <a href="https://www.smartkarma.com/entities/skc-co-ltd" target="_blank" data-smartkarma-citation="entities:3970:1" rel="noopener">SKC Co Ltd (011790 KS)</a> and <a href="https://www.smartkarma.com/entities/samsung-sdi-co-ltd" target="_blank" data-smartkarma-citation="entities:503:1" rel="noopener">Samsung SDI (006400 KS)</a>.</p><p><a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener"> Krafton Inc (259960 KS)</a> is also a Fast Entry to the <a href="https://www.smartkarma.com/entities/korea-stock-exchange-kospi-200-index" target="_blank" data-smartkarma-citation="entities:26021:1" rel="noopener">Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX)</a> and there will be passive buying from those trackers as well.</p>

The KRX has announced the results of the September review of the BBIG indices and the changes will become effective after the close of trading on 9 September.These are the changes to the indices:
Secondary Battery ETF: SK IE Technology (361610 KS) replaces Chunbo Co Ltd (278280 KS)

Bio ETF: SK Bioscience (302440 KS) and Hanmi Pharm (128940 KS) join the index, replacing Shinpoong Pharmaceutical (019170 KS) and Seegene Inc (096530 KS). Additionally, SK Bioscience (302440 KS) replaces SK Biopharmaceuticals Co Ltd (326030 KS) in the top 3 stocks.
Internet ETF: KG Inicis Co Ltd (035600 KS) replaces Rsupport Co Ltd (131370 KS) 
Game ETF:  Krafton Inc (259960 KS) and Devsisters (194480 KS) replace Wemade Co., Ltd. (112040 KS) and Neptune Company (217270 KS)

BBIG ETF: SK Bioscience (302440 KS) and  Krafton Inc (259960 KS) replace SK Biopharmaceuticals Co Ltd (326030 KS) and Kakao Games Corp (293490 KS).
KRX has broken its own rules (everyone does it, so join in!) by including  Krafton Inc (259960 KS) even though the stock listed post the July-end cut off and there is no provision of Fast Entry in the index methodology.Stocks with the largest inflows are SK Bioscience (302440 KS),  Krafton Inc (259960 KS), SK IE Technology (361610 KS), LG Chem Ltd (051910 KS), SK Innovation (096770 KS) and Douzone Bizon (012510 KS) while the stocks with the largest outflows are Kakao Games Corp (293490 KS), SK Biopharmaceuticals Co Ltd (326030 KS), Kakao Corp (035720 KS), Posco Chemical Co Ltd (003670 KS), SKC Co Ltd (011790 KS) and Samsung SDI (006400 KS). Krafton Inc (259960 KS) is also a Fast Entry to the Korea Stock Exchange Kospi 200 Index (KOSPI2 INDEX) and there will be passive buying from those trackers as well.

KRX BBIG Index Rebalance: Krafton, SK Bioscience, SK IE Tech Included (Among Others)

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<p><a href="https://www.smartkarma.com/entities/krafton-inc" target="_blank" data-smartkarma-citation="entities:28956:1" rel="noopener">Krafton Inc (259960 KS)</a> shares are currently trading at 497,000 won, which is nearly flat versus its IPO price of 498,000 won. It traded as low as 400,5000 won on 11 August but has rebounded since then. In this insight, we discuss the end of the one month lockup period for Krafton, which could be significant due to the potential selling by the institutional investors (especially among foreign investors). We also discuss how the valuation of NCsoft has fallen so much that now, there is a high probability of the valuation gap between these companies narrowing in the coming months. </p><div class="content-highlight"><p>Among the various lockup periods, the one month period is perhaps the most important for Krafton. There are 0.97 million shares of Krafton that are under the lockup period (2% of outstanding shares). However, among the overseas institutions, 100% of the shares that are locked up is for the one month period (0.68 million shares or 1.4% of the outstanding shares). As a result, the one month period after the IPO is perhaps the most important in terms of potential selling by the overseas investors. </p></div>

Krafton Inc (259960 KS) shares are currently trading at 497,000 won, which is nearly flat versus its IPO price of 498,000 won. It traded as low as 400,5000 won on 11 August but has rebounded since then. In this insight, we discuss the end of the one month lockup period for Krafton, which could be significant due to the potential selling by the institutional investors (especially among foreign investors). We also discuss how the valuation of NCsoft has fallen so much that now, there is a high probability of the valuation gap between these companies narrowing in the coming months. Among the various lockup periods, the one month period is perhaps the most important for Krafton. There are 0.97 million shares of Krafton that are under the lockup period (2% of outstanding shares). However, among the overseas institutions, 100% of the shares that are locked up is for the one month period (0.68 million shares or 1.4% of the outstanding shares). As a result, the one month period after the IPO is perhaps the most important in terms of potential selling by the overseas investors. 

End of the 1 Month Lockup Period for Krafton & An Excessive Pricing Gap Vs. NCsoft

South Korea

Krafton, Inc. operates as a game development company. The Company develops console games, mobile games, computer games, and other related products. Krafton markets its products throughout South Korea.

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Krafton (259960 KS)

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End of the 1 Month Lockup Period for Krafton & An Excessive Pricing Gap Vs. NCsoft

In this insight, we discuss the end of the one month lockup period for Krafton, which could be significant due to the potential selling by...

Douglas Kim

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