Chart based progressive global trading strategies, Chart Partners

Thomas Schroeder

Chart based progressive global trading strategies

Chart Partners

Chart Partners objective is to discover medium-term cycle turns and profit opportunities before they unfold, within structural trends while preserving capital with clear degrees of risk. We have real return ideas. 

Markets are dynamic and trading systems must reflect this. It is crucial to determine underlying correlations and lead-lag relationships within global markets and the impact on linked instruments. Our weekly Chartonics product gives you short-term trading strategies that can be applied within the medium and longer term macro trends that are mapped out in our strategy updates. 

Our methodology fuses global market variables and isolates drivers in trends. We specialize in FX, index trade in NY and Asia with a focus on Asian stocks. 

Technical Analysis

Nikkei bull breakout call from 28,000 has cleared the higher degree breakout level at 29,000 with impressive momentum. 30,200 is near resistance for a rally stall. Today, we outline add support levels on any dip.We are bullish on dips with risk we continue to run as flows induce a mushroom rise.31,000 remains the minor new high target with an upgrade to 32,400.RSI near 85 is expected to induce a rally stall.

Nikkei bull breakout call from 28,000 has cleared the higher degree breakout level at 29,000 with impressive momentum. 30,200 is near resistance for a rally stall. Today, we outline add support levels on any dip.We are bullish on dips with risk we continue to run as flows induce a mushroom rise.31,000 remains the minor new high target with an upgrade to 32,400.RSI near 85 is expected to induce a rally stall.

Japan is a high conviction long bet on the macro bull wedge eventually breaking to the upside with washout risk to 26,000 in September. 29,000 is the bigger breakout level that would give a macro green light. 28k was the tactical long trigger to test wedge resistance at 29k.Bull conviction on the Nikkei was to buy a new low or a break above 28,000. We closed our short and turned long above 28,000 (28,080), stop below 27,900. Target at 29,000 (28,900). Above 29,000 would target 31,000 in due course. Tactical cycle calls for a rejection and downside test from 29k.

Japan is a high conviction long bet on the macro bull wedge eventually breaking to the upside with washout risk to 26,000 in September. 29,000 is the bigger breakout level that would give a macro green light. 28k was the tactical long trigger to test wedge resistance at 29k.Bull conviction on the Nikkei was to buy a new low or a break above 28,000. We closed our short and turned long above 28,000 (28,080), stop below 27,900. Target at 29,000 (28,900). Above 29,000 would target 31,000 in due course. Tactical cycle calls for a rejection and downside test from 29k.

Korea Stock Exchange KOSPI 200 / Technical Analysis

Our Asia short group kissed fresh sell levels (add back to early August entries) with fresh lows in store for September that will set up buy levels for Japan and Hong Kong.Bank of Korea's rate hike may set of a fresh round of market concerns as we head into the Jackson hole Fed meeting as the growth/inflation tightrope gathers more attention. Today is a key cycle turn date that adds to market energy.Japan's short shows the highest risk of seeing an early bottom near 27k and the level to break to reach for the 26,000 ideal turn zone where we see an opportunity to reverse to long. Hong Kong is next in line to bottom in September.

Our Asia short group kissed fresh sell levels (add back to early August entries) with fresh lows in store for September that will set up buy levels for Japan and Hong Kong.Bank of Korea's rate hike may set of a fresh round of market concerns as we head into the Jackson hole Fed meeting as the growth/inflation tightrope gathers more attention. Today is a key cycle turn date that adds to market energy.Japan's short shows the highest risk of seeing an early bottom near 27k and the level to break to reach for the 26,000 ideal turn zone where we see an opportunity to reverse to long. Hong Kong is next in line to bottom in September.

Asia Short Cluster Digging for September Lows

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

Last evening post market close, the results of the JPX Nikkei 400 review were announced. There are 41 inclusions and 40 deletions to bring the number of constituents back to 400 and the changes will be effective after the close of trading on 30 August.This is the list of inclusions and exclusions.<table class="table table-striped">
<colgroup>
<col>
<col>
<col>
<col>
</colgroup>
<tbody>
<tr>
<td colspan="2" style="text-align: center; width: 396.578px;"><h3>Inclusions</h3></td>
<td colspan="2" style="text-align: center; width: 349.422px;"><h3>Exclusions</h3></td>
</tr>
<tr>
<td style="width: 75.2969px;">1417.T</td>
<td style="width: 321.281px;">Mirait Holdings Corp</td>
<td style="width: 84.3281px;">1333.T</td>
<td style="width: 265.094px;">Maruha Nichiro Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">1942.T</td>
<td style="width: 321.281px;">Kandenko Co Ltd</td>
<td style="width: 84.3281px;">2222.T</td>
<td style="width: 265.094px;">Kotobuki Spirits Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">1973.T</td>
<td style="width: 321.281px;">NEC Networks &amp; System Integration Corp</td>
<td style="width: 84.3281px;">3086.T</td>
<td style="width: 265.094px;">J.Front Retailing Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">2281.T</td>
<td style="width: 321.281px;">Prima Meat Packers Ltd</td>
<td style="width: 84.3281px;">3197.T</td>
<td style="width: 265.094px;">Skylark Holdings Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">3244.T</td>
<td style="width: 321.281px;">Samty Co Ltd</td>
<td style="width: 84.3281px;">4185.T</td>
<td style="width: 265.094px;">JSR Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">3254.T</td>
<td style="width: 321.281px;">Pressance Corp</td>
<td style="width: 84.3281px;">4189.T</td>
<td style="width: 265.094px;">KH Neochem Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">3880.T</td>
<td style="width: 321.281px;">Daio Paper Corp</td>
<td style="width: 84.3281px;">4324.T</td>
<td style="width: 265.094px;">Dentsu Group Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">3923.T</td>
<td style="width: 321.281px;">Rakus Co Ltd</td>
<td style="width: 84.3281px;">4530.T</td>
<td style="width: 265.094px;">Hisamitsu Pharmaceutical Co Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">3941.T</td>
<td style="width: 321.281px;">Rengo Co Ltd</td>
<td style="width: 84.3281px;">4666.T</td>
<td style="width: 265.094px;">Park24 Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">4205.T</td>
<td style="width: 321.281px;">Zeon Corp</td>
<td style="width: 84.3281px;">4755.T</td>
<td style="width: 265.094px;">Rakuten Group Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">4552.T</td>
<td style="width: 321.281px;">JCR Pharmaceuticals Co Ltd</td>
<td style="width: 84.3281px;">5401.T</td>
<td style="width: 265.094px;">Nippon Steel Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">4553.T</td>
<td style="width: 321.281px;">Towa Pharmaceutical Co Ltd</td>
<td style="width: 84.3281px;">5411.T</td>
<td style="width: 265.094px;">JFE Holdings Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">4587.T</td>
<td style="width: 321.281px;">PeptiDream Inc</td>
<td style="width: 84.3281px;">5801.T</td>
<td style="width: 265.094px;">Furukawa Electric Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">4812.T</td>
<td style="width: 321.281px;">Information Services International-Dentsu Ltd</td>
<td style="width: 84.3281px;">6481.T</td>
<td style="width: 265.094px;">THK Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">4848.T</td>
<td style="width: 321.281px;">Fullcast Holdings Co Ltd</td>
<td style="width: 84.3281px;">6588.T</td>
<td style="width: 265.094px;">Toshiba Tec Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">4901.T</td>
<td style="width: 321.281px;">Fujifilm Holdings Corp</td>
<td style="width: 84.3281px;">6753.T</td>
<td style="width: 265.094px;">Sharp Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">5706.T</td>
<td style="width: 321.281px;">Mitsui Mining and Smelting Co Ltd</td>
<td style="width: 84.3281px;">6770.T</td>
<td style="width: 265.094px;">Alps Alpine Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">6055.T</td>
<td style="width: 321.281px;">Japan Material Co Ltd</td>
<td style="width: 84.3281px;">6877.T</td>
<td style="width: 265.094px;">Obara Group Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">6183.T</td>
<td style="width: 321.281px;">BELLSYSTEM24 Holdings Inc</td>
<td style="width: 84.3281px;">7261.T</td>
<td style="width: 265.094px;">Mazda Motor Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">6235.T</td>
<td style="width: 321.281px;">Optorun Co Ltd</td>
<td style="width: 84.3281px;">7458.T</td>
<td style="width: 265.094px;">Daiichikosho Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">6361.T</td>
<td style="width: 321.281px;">Ebara Corp</td>
<td style="width: 84.3281px;">7731.T</td>
<td style="width: 265.094px;">Nikon Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">6544.T</td>
<td style="width: 321.281px;">Japan Elevator Service Holdings Co Ltd</td>
<td style="width: 84.3281px;">7751.T</td>
<td style="width: 265.094px;">Canon Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">6727.T</td>
<td style="width: 321.281px;">Wacom Co Ltd</td>
<td style="width: 84.3281px;">8267.T</td>
<td style="width: 265.094px;">Aeon Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">7177.T</td>
<td style="width: 321.281px;">GMO Financial Holdings Inc</td>
<td style="width: 84.3281px;">9001.T</td>
<td style="width: 265.094px;">Tobu Railway Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">7516.T</td>
<td style="width: 321.281px;">Kohnan Shoji Co Ltd</td>
<td style="width: 84.3281px;">9003.T</td>
<td style="width: 265.094px;">Sotetsu Holdings Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">7947.T</td>
<td style="width: 321.281px;">FP Corp</td>
<td style="width: 84.3281px;">9005.T</td>
<td style="width: 265.094px;">Tokyu Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">8194.T</td>
<td style="width: 321.281px;">Life Corp</td>
<td style="width: 84.3281px;">9007.T</td>
<td style="width: 265.094px;">Odakyu Electric Railway Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">8425.T</td>
<td style="width: 321.281px;">Mizuho Leasing Co Ltd</td>
<td style="width: 84.3281px;">9008.T</td>
<td style="width: 265.094px;">Keio Corp</td>
</tr>
<tr>
<td style="width: 75.2969px;">8595.T</td>
<td style="width: 321.281px;">JAFCO Group Co Ltd</td>
<td style="width: 84.3281px;">9009.T</td>
<td style="width: 265.094px;">Keisei Electric Railway Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">8892.T</td>
<td style="width: 321.281px;">Es-con Japan Ltd</td>
<td style="width: 84.3281px;">9020.T</td>
<td style="width: 265.094px;">East Japan Railway Co</td>
</tr>
<tr>
<td style="width: 75.2969px;">8919.T</td>
<td style="width: 321.281px;">Katitas Co Ltd</td>
<td style="width: 84.3281px;">9021.T</td>
<td style="width: 265.094px;">West Japan Railway Co</td>
</tr>
<tr>
<td style="width: 75.2969px;">9069.T</td>
<td style="width: 321.281px;">Senko Group Holdings Co Ltd</td>
<td style="width: 84.3281px;">9024.T</td>
<td style="width: 265.094px;">Seibu Holdings Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">9090.T</td>
<td style="width: 321.281px;">Maruwa Unyu Kikan Co Ltd</td>
<td style="width: 84.3281px;">9041.T</td>
<td style="width: 265.094px;">Kintetsu Group Holdings Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">9101.T</td>
<td style="width: 321.281px;">Nippon Yusen KK</td>
<td style="width: 84.3281px;">9044.T</td>
<td style="width: 265.094px;">Nankai Electric Railway Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">9104.T</td>
<td style="width: 321.281px;">Mitsui OSK Lines Ltd</td>
<td style="width: 84.3281px;">9045.T</td>
<td style="width: 265.094px;">Keihan Holdings Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">9143.T</td>
<td style="width: 321.281px;">SG Holdings Co Ltd</td>
<td style="width: 84.3281px;">9048.T</td>
<td style="width: 265.094px;">Nagoya Railroad Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">9375.T</td>
<td style="width: 321.281px;">Kintetsu World Express Inc</td>
<td style="width: 84.3281px;">9201.T</td>
<td style="width: 265.094px;">Japan Airlines Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">9418.T</td>
<td style="width: 321.281px;">USEN NEXT HOLDINGS Co Ltd</td>
<td style="width: 84.3281px;">9202.T</td>
<td style="width: 265.094px;">ANA Holdings Inc</td>
</tr>
<tr>
<td style="width: 75.2969px;">9517.T</td>
<td style="width: 321.281px;">eREX Co Ltd</td>
<td style="width: 84.3281px;">9603.T</td>
<td style="width: 265.094px;">H.I.S. Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">9519.T</td>
<td style="width: 321.281px;">Renova Inc</td>
<td style="width: 84.3281px;">9706.T</td>
<td style="width: 265.094px;">Japan Airport Terminal Co Ltd</td>
</tr>
<tr>
<td style="width: 75.2969px;">9787.T</td>
<td style="width: 321.281px;">Aeon Delight Co Ltd</td>
<td style="width: 84.3281px;"></td>
<td style="width: 265.094px;"></td>
</tr>
</tbody>
</table>Estimated one-way turnover at the rebalance is 8.16% and will result in a trade of JPY 468bn.Among the inclusions, the largest impacts will be on <a href="https://www.smartkarma.com/entities/daio-paper-corp" target="_blank" data-smartkarma-citation="entities:3211:1" rel="noopener">Daio Paper Corp (3880 JP)</a>, <a href="https://www.smartkarma.com/entities/mizuho-leasing-co-ltd" target="_blank" data-smartkarma-citation="entities:12780:1" rel="noopener">Mizuho Leasing Co (8425 JP)</a>, <a href="https://www.smartkarma.com/entities/sg-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:26070:1" rel="noopener">SG Holdings (9143 JP)</a>, <a href="https://www.smartkarma.com/entities/katitas-co-ltd" target="_blank" data-smartkarma-citation="entities:26073:1" rel="noopener">Katitas Co Ltd (8919 JP)</a>, <a href="https://www.smartkarma.com/entities/aeon-delight-co-ltd" target="_blank" data-smartkarma-citation="entities:16763:1" rel="noopener">Aeon Delight (9787 JP)</a>, <a href="https://www.smartkarma.com/entities/japan-elevator-service-holdi" target="_blank" data-smartkarma-citation="entities:25910:1" rel="noopener">Japan Elevator Service Holdi (6544 JP)</a>, <a href="https://www.smartkarma.com/entities/kandenko-co-ltd" target="_blank" data-smartkarma-citation="entities:3726:1" rel="noopener">Kandenko Co Ltd (1942 JP)</a>, <a href="https://www.smartkarma.com/entities/senko-group-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:5287:1" rel="noopener">SENKO Group Holdings Co., Ltd. (9069 JP)</a>, <a href="https://www.smartkarma.com/entities/fp-corp" target="_blank" data-smartkarma-citation="entities:7703:1" rel="noopener">Fp Corp (7947 JP)</a> and <a href="https://www.smartkarma.com/entities/prima-meat-packers-ltd" target="_blank" data-smartkarma-citation="entities:8035:1" rel="noopener">Prima Meat Packers (2281 JP)</a>.Deletions with the largest impacts will be <a href="https://www.smartkarma.com/entities/odakyu-electric-railway-co-ltd" target="_blank" data-smartkarma-citation="entities:5405:1" rel="noopener">Odakyu Electric Railway (9007 JP)</a>, <a href="https://www.smartkarma.com/entities/nankai-electric-railway-co" target="_blank" data-smartkarma-citation="entities:633:1" rel="noopener">Nankai Electric Railway Co (9044 JP)</a>, <a href="https://www.smartkarma.com/entities/keio-corp" target="_blank" data-smartkarma-citation="entities:1223:1" rel="noopener">Keio Corp (9008 JP)</a>, <a href="https://www.smartkarma.com/entities/sotetsu-holdings-inc" target="_blank" data-smartkarma-citation="entities:20274:1" rel="noopener">Sotetsu Holdings (9003 JP)</a>, <a href="https://www.smartkarma.com/entities/tobu-railway-co-ltd" target="_blank" data-smartkarma-citation="entities:15463:1" rel="noopener">Tobu Railway (9001 JP)</a>, <a href="https://www.smartkarma.com/entities/aeon-co-ltd" target="_blank" data-smartkarma-citation="entities:3:1" rel="noopener">Aeon Co Ltd (8267 JP)</a>, <a href="https://www.smartkarma.com/entities/tokyu-corp" target="_blank" data-smartkarma-citation="entities:3357:1" rel="noopener">Tokyu Corp (9005 JP)</a>, <a href="https://www.smartkarma.com/entities/keisei-electric-railway-co" target="_blank" data-smartkarma-citation="entities:10876:1" rel="noopener">Keisei Electric Railway Co (9009 JP)</a>, <a href="https://www.smartkarma.com/entities/toshiba-tec-corp" target="_blank" data-smartkarma-citation="entities:17697:1" rel="noopener">Toshiba Tec (6588 JP)</a> and <a href="https://www.smartkarma.com/entities/hisamitsu-pharmaceutical-co" target="_blank" data-smartkarma-citation="entities:17008:1" rel="noopener">Hisamitsu Pharmaceutical Co (4530 JP)</a>.There are changes proposed to the index, mainly on selection criteria for stocks and on qualitative criteria including appointment of independent outside directors and of female corporate directors.

Last evening post market close, the results of the JPX Nikkei 400 review were announced. There are 41 inclusions and 40 deletions to bring the number of constituents back to 400 and the changes will be effective after the close of trading on 30 August.This is the list of inclusions and exclusions.








Inclusions
Exclusions


1417.T
Mirait Holdings Corp
1333.T
Maruha Nichiro Corp


1942.T
Kandenko Co Ltd
2222.T
Kotobuki Spirits Co Ltd


1973.T
NEC Networks &amp; System Integration Corp
3086.T
J.Front Retailing Co Ltd


2281.T
Prima Meat Packers Ltd
3197.T
Skylark Holdings Co Ltd


3244.T
Samty Co Ltd
4185.T
JSR Corp


3254.T
Pressance Corp
4189.T
KH Neochem Co Ltd


3880.T
Daio Paper Corp
4324.T
Dentsu Group Inc


3923.T
Rakus Co Ltd
4530.T
Hisamitsu Pharmaceutical Co Inc


3941.T
Rengo Co Ltd
4666.T
Park24 Co Ltd


4205.T
Zeon Corp
4755.T
Rakuten Group Inc


4552.T
JCR Pharmaceuticals Co Ltd
5401.T
Nippon Steel Corp


4553.T
Towa Pharmaceutical Co Ltd
5411.T
JFE Holdings Inc


4587.T
PeptiDream Inc
5801.T
Furukawa Electric Co Ltd


4812.T
Information Services International-Dentsu Ltd
6481.T
THK Co Ltd


4848.T
Fullcast Holdings Co Ltd
6588.T
Toshiba Tec Corp


4901.T
Fujifilm Holdings Corp
6753.T
Sharp Corp


5706.T
Mitsui Mining and Smelting Co Ltd
6770.T
Alps Alpine Co Ltd


6055.T
Japan Material Co Ltd
6877.T
Obara Group Inc


6183.T
BELLSYSTEM24 Holdings Inc
7261.T
Mazda Motor Corp


6235.T
Optorun Co Ltd
7458.T
Daiichikosho Co Ltd


6361.T
Ebara Corp
7731.T
Nikon Corp


6544.T
Japan Elevator Service Holdings Co Ltd
7751.T
Canon Inc


6727.T
Wacom Co Ltd
8267.T
Aeon Co Ltd


7177.T
GMO Financial Holdings Inc
9001.T
Tobu Railway Co Ltd


7516.T
Kohnan Shoji Co Ltd
9003.T
Sotetsu Holdings Inc


7947.T
FP Corp
9005.T
Tokyu Corp


8194.T
Life Corp
9007.T
Odakyu Electric Railway Co Ltd


8425.T
Mizuho Leasing Co Ltd
9008.T
Keio Corp


8595.T
JAFCO Group Co Ltd
9009.T
Keisei Electric Railway Co Ltd


8892.T
Es-con Japan Ltd
9020.T
East Japan Railway Co


8919.T
Katitas Co Ltd
9021.T
West Japan Railway Co


9069.T
Senko Group Holdings Co Ltd
9024.T
Seibu Holdings Inc


9090.T
Maruwa Unyu Kikan Co Ltd
9041.T
Kintetsu Group Holdings Co Ltd


9101.T
Nippon Yusen KK
9044.T
Nankai Electric Railway Co Ltd


9104.T
Mitsui OSK Lines Ltd
9045.T
Keihan Holdings Co Ltd


9143.T
SG Holdings Co Ltd
9048.T
Nagoya Railroad Co Ltd


9375.T
Kintetsu World Express Inc
9201.T
Japan Airlines Co Ltd


9418.T
USEN NEXT HOLDINGS Co Ltd
9202.T
ANA Holdings Inc


9517.T
eREX Co Ltd
9603.T
H.I.S. Co Ltd


9519.T
Renova Inc
9706.T
Japan Airport Terminal Co Ltd


9787.T
Aeon Delight Co Ltd




Estimated one-way turnover at the rebalance is 8.16% and will result in a trade of JPY 468bn.Among the inclusions, the largest impacts will be on Daio Paper Corp (3880 JP), Mizuho Leasing Co (8425 JP), SG Holdings (9143 JP), Katitas Co Ltd (8919 JP), Aeon Delight (9787 JP), Japan Elevator Service Holdi (6544 JP), Kandenko Co Ltd (1942 JP), SENKO Group Holdings Co., Ltd. (9069 JP), Fp Corp (7947 JP) and Prima Meat Packers (2281 JP).Deletions with the largest impacts will be Odakyu Electric Railway (9007 JP), Nankai Electric Railway Co (9044 JP), Keio Corp (9008 JP), Sotetsu Holdings (9003 JP), Tobu Railway (9001 JP), Aeon Co Ltd (8267 JP), Tokyu Corp (9005 JP), Keisei Electric Railway Co (9009 JP), Toshiba Tec (6588 JP) and Hisamitsu Pharmaceutical Co (4530 JP).There are changes proposed to the index, mainly on selection criteria for stocks and on qualitative criteria including appointment of independent outside directors and of female corporate directors.

JPX Nikkei 400 Index Rebalance: Big Turnover, Big Impact & A Market Consultation

In May, the Nikkei released a market consultation on proposed changes to the <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> covering capping the weight of new constituents in the index at 1% by using a Price Adjustment Factor, limiting the number of index changes at a periodic review to 3, and changing the index universe from stocks listed on TSE's 1st section to stocks that are listed on the Prime Market (post the reorganisation). Most of the proposed changes were subsequently approved.This is the first <a href="https://www.smartkarma.com/entities/nikkei-225" target="_blank" data-smartkarma-citation="entities:22909:1" rel="noopener">Nikkei 225 (NKY INDEX)</a> rebalance after the market consultation that tweaked things around. The tweaks could ensure the inclusion of stocks that were historically not included in the index due to their high stock price, though the impact will be much smaller since their weight in the index will not exceed 1%.At the upcoming rebalance, we see a high probability of <a href="https://www.smartkarma.com/entities/nintendo-co-ltd" target="_blank" data-smartkarma-citation="entities:5415:1" rel="noopener">Nintendo Co Ltd (7974 JP)</a> and <a href="https://www.smartkarma.com/entities/zozo-inc" target="_blank" data-smartkarma-citation="entities:18379:1" rel="noopener">ZOZO Inc (3092 JP)</a> being included in the index while there is a lower probability of <a href="https://www.smartkarma.com/entities/oriental-land-co-ltd" target="_blank" data-smartkarma-citation="entities:13517:1" rel="noopener">Oriental Land (4661 JP)</a> and <a href="https://www.smartkarma.com/entities/orix-corp" target="_blank" data-smartkarma-citation="entities:9936:1" rel="noopener">Orix Corp (8591 JP)</a> being included.Potential deletion candidates are <a href="https://www.smartkarma.com/entities/toho-zinc-co-ltd" target="_blank" data-smartkarma-citation="entities:2796:1" rel="noopener">Toho Zinc (5707 JP)</a>, <a href="https://www.smartkarma.com/entities/sky-perfect-jsat-holdings" target="_blank" data-smartkarma-citation="entities:14097:1" rel="noopener">Sky Perfect Jsat (9412 JP)</a>, <a href="https://www.smartkarma.com/entities/maruha-nichiro-corp" target="_blank" data-smartkarma-citation="entities:20640:1" rel="noopener">Maruha Nichiro (1333 JP)</a> and <a href="https://www.smartkarma.com/entities/pacific-metals-co-ltd" target="_blank" data-smartkarma-citation="entities:3439:1" rel="noopener">Pacific Metals (5541 JP)</a>.There will be quite a large impact from passive trading on a few names.The changes will be announced early September and will be implemented at the close of trading on 30 September.

In May, the Nikkei released a market consultation on proposed changes to the Nikkei 225 (NKY INDEX) covering capping the weight of new constituents in the index at 1% by using a Price Adjustment Factor, limiting the number of index changes at a periodic review to 3, and changing the index universe from stocks listed on TSE's 1st section to stocks that are listed on the Prime Market (post the reorganisation). Most of the proposed changes were subsequently approved.This is the first Nikkei 225 (NKY INDEX) rebalance after the market consultation that tweaked things around. The tweaks could ensure the inclusion of stocks that were historically not included in the index due to their high stock price, though the impact will be much smaller since their weight in the index will not exceed 1%.At the upcoming rebalance, we see a high probability of Nintendo Co Ltd (7974 JP) and ZOZO Inc (3092 JP) being included in the index while there is a lower probability of Oriental Land (4661 JP) and Orix Corp (8591 JP) being included.Potential deletion candidates are Toho Zinc (5707 JP), Sky Perfect Jsat (9412 JP), Maruha Nichiro (1333 JP) and Pacific Metals (5541 JP).There will be quite a large impact from passive trading on a few names.The changes will be announced early September and will be implemented at the close of trading on 30 September.

Nikkei225 Index Rebalance Preview: Perennial Favourites Could Be In

Japan

The Nikkei-225 Stock Average is a price-weighted average of 225 top-rated Japanese companies listed in the First Section of the Tokyo Stock Exchange. The Nikkei Stock Average was first published on May 16, 1949, where the average price was ¥176.21 with a divisor of 225. 

Nikkei 225 (NKY INDEX)

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Our Asia short group kissed fresh sell levels (add back to early August entries) with fresh lows in store for September that will set up buy levels...

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JPX Nikkei 400 Index Rebalance: Big Turnover, Big Impact & A Market Consultation

There are 41 adds and 40 deletes for the JPX NK 400 Index. One-way turnover is high at 8.16% and will result in a trade of JPY 468bn. There will be...

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Nikkei225 Index Rebalance Preview: Perennial Favourites Could Be In

Nintendo could be included in the NKY at the upcoming rebalance though the impact will not be very large. The new methodology could also result in...

Brian Freitas