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

Mirae Asset Tiger Top 10 ETF / Event-Driven

<ul>
<li>Ecopro Co will replace Celltrion Inc. Their float market cap difference is nearly 5 trillion won, so it doesn't seem likely that this will reverse by the end of November.</li>
<li>Ecopro may not have a very significant passive impact x ADTV, given its still high trading volume. On the other hand, Celltrion seems likely to be the target of traders.</li>
<li>From a trading perspective, it's important to focus on the potential price impact of this flow event on Celltrion, which could be amplified depending on the possibility of merger cancellation.</li>
</ul>


Ecopro Co will replace Celltrion Inc. Their float market cap difference is nearly 5 trillion won, so it doesn't seem likely that this will reverse by the end of November.
Ecopro may not have a very significant passive impact x ADTV, given its still high trading volume. On the other hand, Celltrion seems likely to be the target of traders.
From a trading perspective, it's important to focus on the potential price impact of this flow event on Celltrion, which could be amplified depending on the possibility of merger cancellation.


Single-Day ETF Flow Event Not to Be Missed in Korea in December

<ul>
<li>KB Asset Management has announced the release of an inverse ETF, containing the top 10 core stocks in the secondary battery sector.</li>
<li>Given the substantial fluctuations in SSF trading volume in Korea, the flow increase of this ETF might temporarily lead to an unusually high level of backwardation.</li>
<li>Also, we may observe a phenomenon known as 'wag-the-dog' as the flow of this inverse ETF could act as a triggering factor for a temporary spark.</li>
</ul>


KB Asset Management has announced the release of an inverse ETF, containing the top 10 core stocks in the secondary battery sector.
Given the substantial fluctuations in SSF trading volume in Korea, the flow increase of this ETF might temporarily lead to an unusually high level of backwardation.
Also, we may observe a phenomenon known as 'wag-the-dog' as the flow of this inverse ETF could act as a triggering factor for a temporary spark.


Korea's First Sector Inverse ETF: Discussing Flow Trading Impacts

<ul>
<li>In the inaugural constituent selection, FnGuide revealed a noteworthy pattern. Given the smaller market capitalization of the electrolyte suppliers, FnGuide has included only the largest among them in this ETF.</li>
<li>SoulBrain, categorized by FnGuide as an electrolyte supplier like Chunbo, has significantly outperformed Chunbo. As a result, there is a considerable likelihood that SoulBrain will replace Chunbo in December.</li>
<li>The price impact from ETF rebalancing trading has disappeared substantially in Korea. We should focus on the first rebalancing of newly listed ETFs that haven't yet established a learning effect.</li>
</ul>


In the inaugural constituent selection, FnGuide revealed a noteworthy pattern. Given the smaller market capitalization of the electrolyte suppliers, FnGuide has included only the largest among them in this ETF.
SoulBrain, categorized by FnGuide as an electrolyte supplier like Chunbo, has significantly outperformed Chunbo. As a result, there is a considerable likelihood that SoulBrain will replace Chunbo in December.
The price impact from ETF rebalancing trading has disappeared substantially in Korea. We should focus on the first rebalancing of newly listed ETFs that haven't yet established a learning effect.


Overlooked by the Market: A Compelling Long Short Opportunity in Newly-Listed ETF Rebal in Korea

<ul>
<li>KRX stated in this press release that they have identified the suspected stocks involved in illegal trading and have reported them to the financial authorities (Korea FSC and Korea FSS).</li>
<li>The primary concern in the short term seems to revolve around whether the battery stocks are among the ones suspected of illegal trading, as reported to the financial authorities.</li>
<li>We must remain vigilant and ready for the potential recurrence of CFD-related price plunges, as seen in the recent two instances, affecting specific stocks in the short term.</li>
</ul>


KRX stated in this press release that they have identified the suspected stocks involved in illegal trading and have reported them to the financial authorities (Korea FSC and Korea FSS).
The primary concern in the short term seems to revolve around whether the battery stocks are among the ones suspected of illegal trading, as reported to the financial authorities.
We must remain vigilant and ready for the potential recurrence of CFD-related price plunges, as seen in the recent two instances, affecting specific stocks in the short term.


KRX Latest Press Release: CFD Inspection Results & Immediate Impacts to Monitor

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>The Korean government has initiated the M&amp;A privatization of HMM, the largest container shipping company in Korea. </li>
<li>We are Negative on the shares of HMM Co., Ltd. (011200 KS) in the next 6-12 months. We expect additional 20% to 30%+ downside risk on HMM in this period.</li>
<li>Although HMM has a strong balance sheet, more investors are likely to emphasize on the negatives including excessive share dilution risk and worsening environment for the global shipping industry.</li>
</ul>


The Korean government has initiated the M&amp;A privatization of HMM, the largest container shipping company in Korea. 
We are Negative on the shares of HMM Co., Ltd. (011200 KS) in the next 6-12 months. We expect additional 20% to 30%+ downside risk on HMM in this period.
Although HMM has a strong balance sheet, more investors are likely to emphasize on the negatives including excessive share dilution risk and worsening environment for the global shipping industry.


Privatization of HMM: Enormous Shares Dilution Risk

South Korea

POSCO manufactures various types of steel products.  The Company produces hot rolled steel, cold rolled steel, stainless steel, and other forms of steel. The products are mainly used for automobile, construction, and shipbuilding industries.

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Posco ADR (PKX US)

Single-Day ETF Flow Event Not to Be Missed in Korea in December

This post delves into the significant passive impact that will be triggered by constituent changes in the TIGER Top 10 ETF's December rebalancing.

Sanghyun Park

Korea's First Sector Inverse ETF: Discussing Flow Trading Impacts

This post touches on the release of Korea's first sector inverse ETF containing the top 10 core secondary battery stocks and the resulting flow...

Sanghyun Park

Overlooked by the Market: A Compelling Long Short Opportunity in Newly-Listed ETF Rebal in Korea

This post investigates the compelling Long Short opportunity of a newly-listed sector ETF rebalancing in Korea, which appears to be overlooked by...

Sanghyun Park

KRX Latest Press Release: CFD Inspection Results & Immediate Impacts to Monitor

The KRX has issued an official press release, presenting the results of their CFD inspection. This post outlines the key aspects that demand our...

Sanghyun Park

Privatization of HMM: Enormous Shares Dilution Risk

The Korean government has initiated the privatization of HMM, the largest container shipping company in Korea. We are Negative on the shares of HMM...

Douglas Kim

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