Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Private Capital Markets

<ul>
<li>There is a strong possibility of the launch of corporate growth fund private companies ETFs in Korea in 2023. </li>
<li>Once government gives final approval to launch the unlisted Korean companies ETFs in 2023, there is likely to be much greater interest in investing and researching in private Korean companies.</li>
<li>Starting next year, there is a strong probability that we will spend a lot more time on researching and writing about these promising, private companies in Korea. </li>
</ul>


There is a strong possibility of the launch of corporate growth fund private companies ETFs in Korea in 2023. 
Once government gives final approval to launch the unlisted Korean companies ETFs in 2023, there is likely to be much greater interest in investing and researching in private Korean companies.
Starting next year, there is a strong probability that we will spend a lot more time on researching and writing about these promising, private companies in Korea. 


Launch Of Unlisted Korean Companies ETFs in 2023 & How Our Smartkarma Research Would Change

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

<ul>
<li>In the KOSPI, Kakao Pay and SK IET deserve our attention. Their prices are 20-25% above the offering prices, and the release size is 10x ADTV. Both are short-selling available.</li>
<li>On the KOSDAQ, Enchem, Dear U, 4by4, and Poongwon Precision are worth paying attention to. They will face a sizable release with the share prices sitting above their offering prices.</li>
<li>However, none of these KOSDAQ names are available for short-selling. So, we should consider underweighting existing positions rather than building up new positions.</li>
</ul>


In the KOSPI, Kakao Pay and SK IET deserve our attention. Their prices are 20-25% above the offering prices, and the release size is 10x ADTV. Both are short-selling available.
On the KOSDAQ, Enchem, Dear U, 4by4, and Poongwon Precision are worth paying attention to. They will face a sizable release with the share prices sitting above their offering prices.
However, none of these KOSDAQ names are available for short-selling. So, we should consider underweighting existing positions rather than building up new positions.


KOSPI/KOSDAQ Lockup Releases: Kakao Pay, SKIET, Enchem, Dear U, 4by4, & Poongwon Precision

<ul>
<li>The FnGuide Secondary Battery Index currently holds an AUM of ₩1.35T, and the next rebalancing implementation period is from June 13th to 15th.</li>
<li>Since these are same-sector stocks with a high cointegration level, they are suitable for narrow-window basket trading based on passive flow differences.</li>
<li>So, I would consider basket trading by targeting the large-cap constituents with a relatively significant passive flow: <a href="https://www.smartkarma.com/entities/sk-innovation-co-ltd" target="_blank" data-smartkarma-citation="entities:1268:1" rel="noopener">SK Innovation (096770)</a>, <a href="https://www.smartkarma.com/entities/sk-ie-technology" target="_blank" data-smartkarma-citation="entities:29207:1" rel="noopener">SK IE Technology (361610)</a>, <a href="https://www.smartkarma.com/entities/ecopro-bm-co-ltd" target="_blank" data-smartkarma-citation="entities:27873:1" rel="noopener">Ecopro BM (247540)</a>, &amp; <a href="https://www.smartkarma.com/entities/ecopro-co-ltd" target="_blank" data-smartkarma-citation="entities:19029:1" rel="noopener">Ecopro (086520)</a> </li>
</ul>


The FnGuide Secondary Battery Index currently holds an AUM of ₩1.35T, and the next rebalancing implementation period is from June 13th to 15th.
Since these are same-sector stocks with a high cointegration level, they are suitable for narrow-window basket trading based on passive flow differences.
So, I would consider basket trading by targeting the large-cap constituents with a relatively significant passive flow: SK Innovation (096770), SK IE Technology (361610), Ecopro BM (247540), &amp; Ecopro (086520) 


FnGuide Secondary Battery Index (KODEX ETF) Rebalancing Preview

Mirae Asset TIGER Secondary Cell ETF / Event-Driven

<ul>
<li>In general, the projection hit rate for the top market cap constituents was sufficiently high. And the correlation between their stock price direction and passive flow was also high.</li>
<li>However, the projection hit rate for the constituents with a small market cap was relatively low.</li>
<li>If we traded the proposed tradable names with an equal-weighted Long/Short basket, we would have achieved a return of 1.76%. Even excluding Hanjin Kal, we would have achieved 1.31%.</li>
</ul>


In general, the projection hit rate for the top market cap constituents was sufficiently high. And the correlation between their stock price direction and passive flow was also high.
However, the projection hit rate for the constituents with a small market cap was relatively low.
If we traded the proposed tradable names with an equal-weighted Long/Short basket, we would have achieved a return of 1.76%. Even excluding Hanjin Kal, we would have achieved 1.31%.


Recap on WISE Theme Indexes (TIGER ETFs) Rebalancing Trading on April 14

<ul>
<li>Three WISE theme indexes undergo quarterly rebalancing today at the close.</li>
<li>The flow projections shown below in the DETAIL are based on the closing prices of April 12.</li>
<li>We have 13 Long/Short tradable names based on these flow projections: an ADTV of at least ₩10B &amp; a passive flow impact of 0.10x ADTV or more</li>
</ul>


Three WISE theme indexes undergo quarterly rebalancing today at the close.
The flow projections shown below in the DETAIL are based on the closing prices of April 12.
We have 13 Long/Short tradable names based on these flow projections: an ADTV of at least ₩10B &amp; a passive flow impact of 0.10x ADTV or more


WISE Theme Indexes Rebalancing Today: Flow Projections as of Close on April 12

South Korea

SK IE Technology Co., Ltd operates as a material solution provider. The Company provides information material solutions, electronic materials solutions, and other products. SK IE Technology conducts businesses across worldwide.

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SK IE Technology (361610 KS)

Launch Of Unlisted Korean Companies ETFs in 2023 & How Our Smartkarma Research Would Change

Once government gives final approval to launch the unlisted Korean companies ETFs in 2023, there is likely to be much greater interest in investing...

Douglas Kim

KOSPI/KOSDAQ Lockup Releases: Kakao Pay, SKIET, Enchem, Dear U, 4by4, & Poongwon Precision

This post compiles all the KOSPI/KOSDAQ lockup releases in May based on the data released by the KSD. Kakao Pay, SKIET, Enchem, Dear U, 4by4, &...

Sanghyun Park

FnGuide Secondary Battery Index (KODEX ETF) Rebalancing Preview

This post previews the FnGuide Secondary Battery Index rebalancing in June. The tradable names at this point are SK Innovation, SKIET, Ecopro BM,...

Sanghyun Park

Recap on WISE Theme Indexes (TIGER ETFs) Rebalancing Trading on April 14

This post is a recap of our flow trading on the WISE Theme Indexes (TIGER ETFs) rebalancing, which was carried out on April 14.

Sanghyun Park

WISE Theme Indexes Rebalancing Today: Flow Projections as of Close on April 12

Three WISE Theme Indexes undergo quarterly rebalancing today at the close. This post screens 13 tradable names for a Long/Short basket day trading.

Sanghyun Park

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