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

TSE Tokyo Price Index TOPIX / Technical Analysis

<ul>
<li>The MSCI ACWI index ACWI-US briefly fell below major support at $90.50-$91.50, though we do not consider it a "decisive" breakdown and we now see a false breakdown (bullish).</li>
<li>On MSCI ACWI (local currency), a false breakdown appears to already be in place, which is bullish as long as the index does not break to a new low.</li>
<li>MSCI EM (EEM-US) continues to hold above $36.50-$37 support, while MSCI ACWI ex-US (ACWX-US) and EAFE (EFA-US) remain above supports at $45 and $65-$66, respectively. Pullback is likely over.</li>
</ul>


The MSCI ACWI index ACWI-US briefly fell below major support at $90.50-$91.50, though we do not consider it a "decisive" breakdown and we now see a false breakdown (bullish).
On MSCI ACWI (local currency), a false breakdown appears to already be in place, which is bullish as long as the index does not break to a new low.
MSCI EM (EEM-US) continues to hold above $36.50-$37 support, while MSCI ACWI ex-US (ACWX-US) and EAFE (EFA-US) remain above supports at $45 and $65-$66, respectively. Pullback is likely over.


Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over

Asset Allocation & Fund Positioning, Copley Fund Research

Steven Holden

Asset Allocation & Fund Positioning

Copley Fund Research

Copley Fund Research provide research and data on asset allocation among Global and Emerging Market equity funds.  The analysis details absolute and relative positioning across countries, sectors and industries together with highly granular data on single stock and single fund allocations.  The data is updated monthly with time series going back to January 2011.

Global Research - Analysis of 165 prominent Global equity funds, combined AUM $335bn
GEM Research - Analysis of 127 prominent global EM equity funds, combined AUM $250bn

Asset Allocation - Global and GEM Equity

Equity Bottom-Up

New Oriental Education & Techn / Equity Bottom-Up

<ul>
<li>MSCI China Funds are starting to engage with New Oriental Education &amp; Technology after a big exodus in 2021 following China’s Tech Crackdown.</li>
<li>Since the lows of 2022, New Oriental Education has been one of the key beneficiaries of active fund rotation.</li>
<li>Previous holders such as HSBC, Mirae and BlackRock have bought back in after closing out in 2021, but there is still a long way to go to reach previous highs.</li>
</ul>


MSCI China Funds are starting to engage with New Oriental Education &amp; Technology after a big exodus in 2021 following China’s Tech Crackdown.
Since the lows of 2022, New Oriental Education has been one of the key beneficiaries of active fund rotation.
Previous holders such as HSBC, Mirae and BlackRock have bought back in after closing out in 2021, but there is still a long way to go to reach previous highs.


New Oriental Education & Technology: Back From the Dead

Overseas Chinese Equities, Aequitas Research

Ming Lu

Overseas Chinese Equities

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Alibaba Group Holding  / Equity Bottom-Up

<ul>
<li>JD is in fact competing with a broadcaster on Alibaba’s app, but not Alibaba itself.</li>
<li>Trip.com’s domestic orders during National Holidays were double last year.</li>
<li>New Oriental’s revenue increased strongly with new learning centers in 1Q24.</li>
</ul>


JD is in fact competing with a broadcaster on Alibaba’s app, but not Alibaba itself.
Trip.com’s domestic orders during National Holidays were double last year.
New Oriental’s revenue increased strongly with new learning centers in 1Q24.


China Consumption Weekly (30 Oct 2023): Alibaba, Trip.com, New Oriental, Weibo

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>An ad hoc <a href="https://www.smartkarma.com/entities/s-p-asx-200" target="_blank" data-smartkarma-citation="entities:22901:1" rel="noopener">S&amp;P/ASX 200 (AS51 INDEX)</a> rebalance will be implemented at the close on 17 October with <a href="https://www.smartkarma.com/entities/light-wonder-inc-7e7d040f-e811-4fb9-9710-796a39af299e" target="_blank" data-smartkarma-citation="entities:40171:1" rel="noopener">Light &amp; Wonder (LNW AU)</a> replacing <a href="https://www.smartkarma.com/entities/united-malt-group-ltd" target="_blank" data-smartkarma-citation="entities:29116:1" rel="noopener">United Malt Group Ltd (UMG AU)</a>. </li>
<li>The rebalances of <a href="https://www.smartkarma.com/entities/wisdomtree-emerging-markets-146edc02-f8a5-4ac5-968b-5f0f7c89e476" target="_blank" data-smartkarma-citation="entities:32683:1" rel="noopener">Wisdomtree Emerging Markets (DEM US)</a>, <a href="https://www.smartkarma.com/entities/wisdomtree-em-small-cap" target="_blank" data-smartkarma-citation="entities:32679:1" rel="noopener">Wisdomtree Em Small Cap (DGS US)</a> and <a href="https://www.smartkarma.com/entities/wisdmtree-emerg-mkt-ex-st-ow" target="_blank" data-smartkarma-citation="entities:32798:1" rel="noopener">Wisdmtree Emerg Mkt Ex-St Ow (XSOE US)</a> will be implemented on 18 October.</li>
<li>There were net outflows from onshore China ETFs with inflows to larger cap ETFs and outflows mainly from the <a href="https://www.smartkarma.com/entities/csi-smallcap-500-index-shang" target="_blank" data-smartkarma-citation="entities:35347:1" rel="noopener">CSI Smallcap 500 Index</a> and CSI 1000 Index trackers.</li>
</ul>


An ad hoc S&amp;P/ASX 200 (AS51 INDEX) rebalance will be implemented at the close on 17 October with Light &amp; Wonder (LNW AU) replacing United Malt Group Ltd (UMG AU). 
The rebalances of Wisdomtree Emerging Markets (DEM US), Wisdomtree Em Small Cap (DGS US) and Wisdmtree Emerg Mkt Ex-St Ow (XSOE US) will be implemented on 18 October.
There were net outflows from onshore China ETFs with inflows to larger cap ETFs and outflows mainly from the CSI Smallcap 500 Index and CSI 1000 Index trackers.


Index Rebalance & ETF Flow Recap: HSCEI, HSTECH, TOPIX FFW, SSE50, AS51, ChiNext, Kenedix, Liontown

China

New Oriental Education & Technology Group, Inc. offers educational services. The Company offers foreign language training, test preparation courses for admissions and assessment tests in the United States, the PRC and Commonwealth countries, primary and secondary school education, and other services. New Oriental Education & Technology Group also operates software development.

TAL Education Group provides educational services. The Company offers comprehensive tutoring services to students covering core academic subjects such as mathematics, English, Chinese, physics, chemistry, political science, and history, biology. TAL Education Group serves students in China.

Fu Shou Yuan International Group, Ltd. is a death care service provider in China.  The Company operates cemeteries and funeral facilities.

China Education Group Holdings Limited offers educational services. The Company provides private universities operating services, education training services, and other services. China Education Group Holdings offers services in Hong Kong.

East Buy Holding Limited operates livestreaming platform businesses. The Company provides private label products including agricultural products, food, books, and household goods. East Buy Holding also conducts college education businesses.

Xiamen Unigroup Xue Co., Ltd. offers various educational services. The Company provides after-school tutoring and education consulting. Unigroup Xue also participates in real estate development and investment activities.

Zhejiang Yasha Decoration Company Ltd. provides decorating services for large-scale infrastructure, high-end luxury hotel and luxury residential property.

China Chunlai Education Group Co., Ltd. provides educational services. The Company offers private higher education services and other services. China Chunlai Education Group provides services in China.

China East Education Holdings Limited provides vocational training educational services. The Company offers culinary education, internet technology education, automotive education, and other services. China East Education Holdings provides services in China.

Shanghai Xin Nanyang Co., Ltd., through its subsidiaries, manufactures communication products and industrial equipment, develops cable TV network, security trading, and communication systems, provides network integration, education, and precision processing services.

Service Corporation International provides death care services worldwide.  The Company operates funeral service locations, cemeteries, and crematoria.  Service also sells prearranged funeral services in most of its service markets.

ADT Inc. provides commercial security systems and services. The Company offers home and business automation solutions which includes temperature, burglary, flood, fire and smoke, and medical alert monitoring, as well as security cameras, remote access, and wireless home security systems. ADT serves customers in the United States.

Bright Horizons Family Solutions Inc. provides child care and early education services as well as other services designed to help employers and families better address the challenges of work and life. The Company provides services primarily under multi-year contracts with employers who offer child care and other dependent care solutions as part of their employee benefits packages.

Bright Horizons Family Solutions (BFAM US)

H&R Block, Inc. provides a wide range of financial products and services through its subsidiaries.  The Company provides tax services to the general public, accounting and consulting services, and consumer financial and personal productivity software.  H&R Block provides its tax services to clients in the United States and other countries.

Golden MV Holdings, Inc. engages in the development and sale of memorial lots across various parts of the Philippines. The Company develops, constructs, and operates columbarium facilities.

Graham Holdings Company is a diversified education and media company whose principal operations include educational services, newspaper print and online publishing, television broadcasting and cable television systems.

Stride, Inc. is a technology-based education company. The Company offers proprietary curriculum, software, and educational solutions created for online delivery to students in kindergarten through 12th grade and K-12.

Grand Canyon Education, Inc. provides online post secondary education services. The Company offers graduate and undergraduate degree programs in disciplines of education, business, and healthcare.

IDP Education Limited provides student placement services to enroll into universities, schools, and colleges. The Company offers student services, such as university and course guidance, visa application and scholarships assistance, and pre-departure support services. IDP Education operates worldwide.

Strategic Education, Inc. provides educational services. The College offers working adults undergraduate and graduate degree programs in business and public administration, accounting, and information technology. Strategic Education provides courses in the eastern United States.

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New Oriental Education & Techn (9901 HK)

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

Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over

The MSCI $ACWI briefly fell below our $90.50 support but quickly reclaimed, suggesting a false breakdown and the likely end to this pullback in...

Vermilion Research

New Oriental Education & Technology: Back From the Dead

MSCI China Funds are starting to engage with New Oriental Education & Technology after a big exodus in 2021 following China’s Tech Crackdown.

Steven Holden

China Consumption Weekly (30 Oct 2023): Alibaba, Trip.com, New Oriental, Weibo

JD is competing with a broadcaster on Alibaba’s app. Trip.com’s domestic orders during National Holidays were double last year. New Oriental’s...

Ming Lu

Index Rebalance & ETF Flow Recap: HSCEI, HSTECH, TOPIX FFW, SSE50, AS51, ChiNext, Kenedix, Liontown

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

Brian Freitas

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

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

Japan Bullishly Inflecting; Constructive Outlook Intact; Global Pullback Likely Over

​The MSCI $ACWI briefly fell below our $90.50 support but quickly reclaimed, suggesting a false breakdown and the likely end to this pullback in...

Vermilion Research

New Oriental Education & Technology: Back From the Dead

MSCI China Funds are starting to engage with New Oriental Education & Technology after a big exodus in 2021 following China’s Tech Crackdown.

Steven Holden

China Consumption Weekly (30 Oct 2023): Alibaba, Trip.com, New Oriental, Weibo

JD is competing with a broadcaster on Alibaba’s app. Trip.com’s domestic orders during National Holidays were double last year. New Oriental’s...

Ming Lu

Index Rebalance & ETF Flow Recap: HSCEI, HSTECH, TOPIX FFW, SSE50, AS51, ChiNext, Kenedix, Liontown

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

Brian Freitas

The MSCI $ACWI briefly fell below our $90.50 support but quickly reclaimed, suggesting a false breakdown and the likely end to this pullback in...