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

Cross Asset Strategy

<ul>
<li>Average holding weights in China &amp; HK have fallen to their lowest levels since late 2019. From a peak of 38.26% in October 2020, exposure has dropped to 29.01%</li>
<li>China underweights have contracted due to a combination of Russian overweights being displaced, and on the back of significant falls in the price of key index holdings.</li>
<li>China is still the largest holding in EM by a margin, but was costly to EM managers over the last year.  Active managers may be tempted to reduce allocations.</li>
</ul>


Average holding weights in China &amp; HK have fallen to their lowest levels since late 2019. From a peak of 38.26% in October 2020, exposure has dropped to 29.01%
China underweights have contracted due to a combination of Russian overweights being displaced, and on the back of significant falls in the price of key index holdings.
China is still the largest holding in EM by a margin, but was costly to EM managers over the last year.  Active managers may be tempted to reduce allocations.


China:  EM Investors Precariously Positioned

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

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

KraneShares CSI China Internet ETF / Event-Driven

<ul>
<li>China ADRs were sharply lower last week as the SEC started to name companies that were identified under the Holding Foreign Companies Accountable Act (HFCAA).</li>
<li>Then <a href="https://www.smartkarma.com/entities/didi-chuxing-inc" target="_blank" data-smartkarma-citation="entities:27467:1" rel="noopener">DiDi Global</a> dropped 44% on Friday following reports that the their proposals to prevent data/security leaks did not meet CAC's requirements and work on the HK listing was halted.</li>
<li>With 2024 not too far away, a lot of the U.S. listed companies will look at listing in Hong Kong in the near future. That will have its own implications.</li>
</ul>


China ADRs were sharply lower last week as the SEC started to name companies that were identified under the Holding Foreign Companies Accountable Act (HFCAA).
Then DiDi Global dropped 44% on Friday following reports that the their proposals to prevent data/security leaks did not meet CAC's requirements and work on the HK listing was halted.
With 2024 not too far away, a lot of the U.S. listed companies will look at listing in Hong Kong in the near future. That will have its own implications.


China ADRs & HFCAA: Pace of Homecoming Listings Should Pick Up & Implications

Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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.

Equity Capital Markets

<ul>
<li>Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.</li>
<li>As <a href="https://www.smartkarma.com/entities/sbi-sumishin-net-bank" target="_blank" data-smartkarma-citation="entities:34572:1" rel="noopener">SBI Sumishin Net Bank (7163 JP)</a> called off its listing, Government of India is still vacillating on <a href="https://www.smartkarma.com/entities/life-insurance-corp-of-india-lic" target="_blank" data-smartkarma-citation="entities:28829:1" rel="noopener">Life Insurance Corp of India (LIC) (1248Z IN)</a>. </li>
<li>Placement scene remains quiet with <a href="https://www.smartkarma.com/entities/cosmo-energy-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:26565:1" rel="noopener">Cosmo Energy Holdings (5021 JP)</a> deeply discounted block following up on <a href="https://www.smartkarma.com/entities/zip-industries-aust-pty-ltd" target="_blank" data-smartkarma-citation="entities:24111:1" rel="noopener">ZIP Holdings (ZHL AU)</a> deeply discounted block the previous week.</li>
</ul>


Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
As SBI Sumishin Net Bank (7163 JP) called off its listing, Government of India is still vacillating on Life Insurance Corp of India (LIC) (1248Z IN). 
Placement scene remains quiet with Cosmo Energy Holdings (5021 JP) deeply discounted block following up on ZIP Holdings (ZHL AU) deeply discounted block the previous week.


ECM Weekly (13th Mar 2022)-Arrail, Aquila, Propguru, Ferretti, Jinmao, Nio, Fabindia, Hyu Hvy, Cosmo

<ul>
<li>On 8th Mar 2022, Securities Exchange Commission (SEC) added five China ADR names to its provisional list of issuers under the Holding Foreign Companies Accountable Act (HFCAA).</li>
<li>There is nothing new about the list, on 2nd Dec 2021, SEC had issued final amendments to implement the HFCAA which had already spoken about the list and its implications.</li>
<li>In this note, we'll talk about the latest developments its possible timelines and implications.</li>
</ul>


On 8th Mar 2022, Securities Exchange Commission (SEC) added five China ADR names to its provisional list of issuers under the Holding Foreign Companies Accountable Act (HFCAA).
There is nothing new about the list, on 2nd Dec 2021, SEC had issued final amendments to implement the HFCAA which had already spoken about the list and its implications.
In this note, we'll talk about the latest developments its possible timelines and implications.


China ADRs Delisting - SEC Sets the Clock Ticking and Sends China ADRs Tripping

<ul>
<li>
<a href="https://www.smartkarma.com/entities/nio-inc-2d526675-c878-4104-840f-87fed1735e85" target="_blank" data-smartkarma-citation="entities:35652:1" rel="noopener">NIO Inc (9866 HK)</a> is expected to list on the <a href="https://www.smartkarma.com/entities/hong-kong-exchanges-clearing" target="_blank" data-smartkarma-citation="entities:490:1" rel="noopener">HKEX (388 HK)</a> tomorrow. Nearly 820m Class A shares are now held on the Hong Kong Share Register.</li>
<li>We do not expect <a href="https://www.smartkarma.com/entities/nio-inc-2d526675-c878-4104-840f-87fed1735e85" target="_blank" data-smartkarma-citation="entities:35652:1" rel="noopener">NIO Inc (9866 HK)</a> to get Fast Entry to the <a href="https://www.smartkarma.com/entities/hang-seng-china-enterprises-index" target="_blank" data-smartkarma-citation="entities:22900:1" rel="noopener">HSCEI INDEX</a> and <a href="https://www.smartkarma.com/entities/hang-seng-tech-index" target="_blank" data-smartkarma-citation="entities:31367:1" rel="noopener">HSTECH INDEX</a>, though inclusion in the HSTECH could take place in June.</li>
<li>
<a href="https://www.smartkarma.com/entities/nio-inc-2d526675-c878-4104-840f-87fed1735e85" target="_blank" data-smartkarma-citation="entities:35652:1" rel="noopener">NIO Inc (9866 HK)</a> is not likely to get Fast Entry to the HSCI. The stock is not eligible for Southbound Stock Connect as a Secondary Listing.</li>
</ul>



NIO Inc (9866 HK) is expected to list on the HKEX (388 HK) tomorrow. Nearly 820m Class A shares are now held on the Hong Kong Share Register.
We do not expect NIO Inc (9866 HK) to get Fast Entry to the HSCEI INDEX and HSTECH INDEX, though inclusion in the HSTECH could take place in June.

NIO Inc (9866 HK) is not likely to get Fast Entry to the HSCI. The stock is not eligible for Southbound Stock Connect as a Secondary Listing.


NIO (9866 HK) Secondary Listing: HSTECH Inclusion in June Likely

China

NIO Inc. manufactures and sells automobiles. The Company offers electric vehicles and parts, as well as provides battery charging services. NIO serves customers worldwide.

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NIO (NIO US)

China: EM Investors Precariously Positioned

China is still the largest holding in EM, but was costly to EM funds over the last year. In the wake of the Russia-Sino alliance, active managers...

Steven Holden

China ADRs & HFCAA: Pace of Homecoming Listings Should Pick Up & Implications

The SEC naming 5 companies under the HFCAA put China ADRs under pressure last week. The news that the CAC had nixed DIDI's HK listing plans added...

Brian Freitas

ECM Weekly (13th Mar 2022)-Arrail, Aquila, Propguru, Ferretti, Jinmao, Nio, Fabindia, Hyu Hvy, Cosmo

Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.

Sumeet Singh

China ADRs Delisting - SEC Sets the Clock Ticking and Sends China ADRs Tripping

On 8th Mar 2022, Securities Exchange Commission (SEC) added five China ADR names to its provisional list of issuers under the Holding Foreign...

Sumeet Singh

NIO (9866 HK) Secondary Listing: HSTECH Inclusion in June Likely

NIO is expected to list on the HKEX tomorrow as a Secondary Listing. We do not expect any passive inflows to the stock in the short-term. HSTECH...

Brian Freitas

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