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

Equity Analyst, LightStream Research

Oshadhi Kumarasiri

Equity Analyst

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.

Equity Bottom-Up

Alibaba Group Holding  / Equity Bottom-Up

<ul>
<li>Over the last two days on Weibo there was a lot of noise regarding massive layoffs at Chinese tech giants such as <a href="https://www.smartkarma.com/entities/alibaba-group-holding-ltd" target="_blank" data-smartkarma-citation="entities:787:1" rel="noopener">Alibaba Group (BABA US)</a> and <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a>.</li>
<li>Local news outlet “Yilanshangye”, called that Alibaba’s community group buying platform MMC is planning to release around 20% of its employees, with several business lines already finalising their layoff lists.</li>
<li>With investor appetite for growth companies changing rapidly over the last few months, it seems <a href="https://www.smartkarma.com/entities/alibaba-group" target="_blank" data-smartkarma-citation="entities:28434:1" rel="noopener">Alibaba Group (9988 HK)</a> could be struggling to finance several of its loss-making ventures.</li>
</ul>


Over the last two days on Weibo there was a lot of noise regarding massive layoffs at Chinese tech giants such as Alibaba Group (BABA US) and Tencent (700 HK).
Local news outlet “Yilanshangye”, called that Alibaba’s community group buying platform MMC is planning to release around 20% of its employees, with several business lines already finalising their layoff lists.
With investor appetite for growth companies changing rapidly over the last few months, it seems Alibaba Group (9988 HK) could be struggling to finance several of its loss-making ventures.


Alibaba: Rumoured Layoffs Could Be a Sign of The Company Running Out of Funding Sources

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

GoTo Gojek Tokopedia Tbk PT / Equity Capital Markets

<ul>
<li>GoTo aims to raise around US$1.25bn from a local listing, which will mainly be targeted at domestic investors. The company has filed its prospectus today.</li>
<li>GoTo, is an Indonesian holding company, was formed in May 2021 as a result of a merger between Gojek, leading player in ride hailing, and Tokopedia, leading e-commerce player.</li>
<li>In this note, we will take a quick look at the company's financial performance.</li>
</ul>


GoTo aims to raise around US$1.25bn from a local listing, which will mainly be targeted at domestic investors. The company has filed its prospectus today.
GoTo, is an Indonesian holding company, was formed in May 2021 as a result of a merger between Gojek, leading player in ride hailing, and Tokopedia, leading e-commerce player.
In this note, we will take a quick look at the company's financial performance.


GoTo Pre-IPO - Quick Take on US$1bn+ Domestic Listing

Shifara Samsudeen, ACMA, CGMA

<ul>
<li>Wall Street Journal (WSJ) reported yesterday that <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> is facing a possible record fine for violating anti-money laundering regulations in China.</li>
<li>People’s Bank of China has found that WeChat Pay had allowed transfer and laundering of funds with illicit transactions which violates the country’s anti-money laundering regulations.</li>
<li>Tencent’s shares dropped further 10.3% to HK$331 per share from HK$369 per share during yesterday’s trade following the above report.</li>
</ul>


Wall Street Journal (WSJ) reported yesterday that Tencent (700 HK) is facing a possible record fine for violating anti-money laundering regulations in China.
People’s Bank of China has found that WeChat Pay had allowed transfer and laundering of funds with illicit transactions which violates the country’s anti-money laundering regulations.
Tencent’s shares dropped further 10.3% to HK$331 per share from HK$369 per share during yesterday’s trade following the above report.


Tencent: Possible Record Fine for Anti-Money Laundering

Event-Driven

<ul>
<li>On 23rd Dec, Tencent declared a dividend in the form of distribution in specie of 457.326m shares of JD.com, i.e. 1 share of JD.com for every 21 shares of Tencent.</li>
<li>While Tencent went ex-div on 20th Jan 2022, the actual settlement of the distribution is expected to happen on or about 25th Mar 2022.</li>
<li>In this note, we talk about the likely impact of Prosus' shareholding on passive flows at the time of settlement.</li>
</ul>


On 23rd Dec, Tencent declared a dividend in the form of distribution in specie of 457.326m shares of JD.com, i.e. 1 share of JD.com for every 21 shares of Tencent.
While Tencent went ex-div on 20th Jan 2022, the actual settlement of the distribution is expected to happen on or about 25th Mar 2022.
In this note, we talk about the likely impact of Prosus' shareholding on passive flows at the time of settlement.


JD.com Tencent Div Distribution - The US$10bn Overhang - Passives Might Have to Sell

China

Tencent Holdings Limited operates as an investment holding company. The Company, through its subsidiaries, provides Internet and mobile value-added services (VAS), online advertising, and e-commerce transactions. Tencent Holdings offers services to users worldwide.

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Tencent (700 HK)

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

Alibaba: Rumoured Layoffs Could Be a Sign of The Company Running Out of Funding Sources

Falling debt balance could be an indication of unwillingness of financial institutions to lend more to Alibaba’s loss-making businesses.

Oshadhi Kumarasiri

GoTo Pre-IPO - Quick Take on US$1bn+ Domestic Listing

GoTo aims to raise around US$1.25bn from a local listing, which will mainly be targeted at domestic investors. The company has filed its prospectus...

Sumeet Singh

Tencent: Possible Record Fine for Anti-Money Laundering

Wall Street Journal reported that Tencent is facing a possible record fine for violating anti-money laundering regulations in China. Given WeChat...

Shifara Samsudeen, ACMA, CGMA

JD.com Tencent Div Distribution - The US$10bn Overhang - Passives Might Have to Sell

On 23rd Dec, Tencent declared a dividend in the form of distribution in specie of 457.326m shares of JD.com, i.e. 1 share of JD.com for every 21...

Sumeet Singh

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