Japan/Asia Long-Short, LightStream Research

Mio Kato

Japan/Asia Long-Short

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Event-Driven

<ul>
<li>The Nikkei is now down 9.57% vs. when we first recommended our skew trade (now up 0.40%). </li>
<li>Despite some frustrating idiosyncratic moves which have prevented the skew trade from outperforming more it has mostly held up. </li>
<li>Looking forward, we believe it is worthwhile assessing upside and downside macro risks for the components of the trade.</li>
</ul>


The Nikkei is now down 9.57% vs. when we first recommended our skew trade (now up 0.40%). 
Despite some frustrating idiosyncratic moves which have prevented the skew trade from outperforming more it has mostly held up. 
Looking forward, we believe it is worthwhile assessing upside and downside macro risks for the components of the trade.


TOPIX-Nikkei Skew Trade – Updates Factoring in Ukraine

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

<ul>
<li>The broad global indexes are decisively below our "lines in the sand" of $54 on MSCI ACWI ex-US (ACWX-US), $75.25 on MSCI EAFE (EFA-US), and $99 on MSCI ACWI (ACWI-US).</li>
<li>As noted in our Feb. 15 Int'l Macro Vision, we are bearish at the index level as long as we are below the aforementioned levels.</li>
<li>Global 10-year sovereign yields remain elevated, leading to outperformance from value Sectors (Energy/Materials/Financials) which remain our preferred area of the market. We also continue to like defensive areas, especially Staples.</li>
</ul>


The broad global indexes are decisively below our "lines in the sand" of $54 on MSCI ACWI ex-US (ACWX-US), $75.25 on MSCI EAFE (EFA-US), and $99 on MSCI ACWI (ACWI-US).
As noted in our Feb. 15 Int'l Macro Vision, we are bearish at the index level as long as we are below the aforementioned levels.
Global 10-year sovereign yields remain elevated, leading to outperformance from value Sectors (Energy/Materials/Financials) which remain our preferred area of the market. We also continue to like defensive areas, especially Staples.


Buying Metals/Mining and Consumer Staples

Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Thematic (Sector/Industry)

<ul>
<li>This is an in-depth review of Japanese e-commerce in the last 18 months, a time when e-commerce expanded rapidly and by 2023, e-commerce will be Japan’s single biggest retail channel.</li>
<li>We are now riding a wave of change as retailers integrate the e-commerce channel into their businesses, increasingly approaching a true omnichannel model.</li>
<li>And this is important in Japan because, although e-commerce penetration appears low, this overlooks the importance, convenience and ease of access to physical shops and integration with online.</li>
</ul>


This is an in-depth review of Japanese e-commerce in the last 18 months, a time when e-commerce expanded rapidly and by 2023, e-commerce will be Japan’s single biggest retail channel.
We are now riding a wave of change as retailers integrate the e-commerce channel into their businesses, increasingly approaching a true omnichannel model.
And this is important in Japan because, although e-commerce penetration appears low, this overlooks the importance, convenience and ease of access to physical shops and integration with online.


<ul>
<li>Japanese are developing a growing love for frozen foods, creating new opportunities for food brands and retailers.  </li>
<li>Frozen foods were long overlooked within the supply chain because of a traditional emphasis on fresh foods but frozen </li>
<li>As supply has increased, consumer demand has grown to match and now, with the growth of e-commerce and home delivery, frozen foods offer key advantages to both consumers and retailers.</li>
</ul>


Japanese are developing a growing love for frozen foods, creating new opportunities for food brands and retailers.  
Frozen foods were long overlooked within the supply chain because of a traditional emphasis on fresh foods but frozen 
As supply has increased, consumer demand has grown to match and now, with the growth of e-commerce and home delivery, frozen foods offer key advantages to both consumers and retailers.


<ul>
<li>Numerous reports indicate that Seven &amp; I is preparing its Sogo Seibu department store subsidiary for sale. </li>
<li>This follows years of calls from major investors to dispose of underperforming assets at Japan’s second largest retail conglomerate.</li>
<li>Seven &amp; I still has many problems to solve in its domestic business. Ito-Yokado remains the biggest problem but perhaps won't be disposed of while the company's 98-year old founder lives.</li>
</ul>


Numerous reports indicate that Seven &amp; I is preparing its Sogo Seibu department store subsidiary for sale. 
This follows years of calls from major investors to dispose of underperforming assets at Japan’s second largest retail conglomerate.
Seven &amp; I still has many problems to solve in its domestic business. Ito-Yokado remains the biggest problem but perhaps won't be disposed of while the company's 98-year old founder lives.


Seven & I: Selling Sogo Seibu Is Just the Start

Japan

Seven & i Holdings Co., Ltd. is a holding company which was established through the merger of Ito-Yokado Co., Seven Eleven Japan Co., and Denny's Japan. The Company plans, manages, and operates mainly convenience stores, supermarkets, and department stores.

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Seven & I Holdings (3382 JP)

TOPIX-Nikkei Skew Trade – Updates Factoring in Ukraine

The Nikkei is down 9.57% vs. when we initiated our skew trade (now up 0.40%). Despite some frustrating idiosyncratic moves the trade has mostly...

Mio Kato

Buying Metals/Mining and Consumer Staples

Commodity prices remain in a secular bull market, and now even gold is joining the rally. This is bullish for global metals/mining stocks (precious...

Vermilion Research

E-Commerce in Japan: The Big Review

Japan's e-commerce sector expanded rapidly in the last 18 months. The following is a complete review and analysis of the major trends as well as...

Michael Causton

Japan's New Food Boom: Frozen Food

Frozen food sales have boomed during the pandemic but the new enthusiasm for all things frozen is a long-term trend and some retailers and...

Michael Causton

Seven & I: Selling Sogo Seibu Is Just the Start

Seven & I could be one of Japan's most profitable retailers – in part because one if its parts already is. The problem is the rest of the group but...

Michael Causton

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