Pan-Asia Catalysts/Events, Quiddity Advisors

Travis Lundy

Pan-Asia Catalysts/Events

Quiddity Advisors

Event-Driven

TSE Tokyo Price Index TOPIX / Event-Driven

<ul>
<li>The GPIF reported its <a href="https://www.gpif.go.jp/operation/21434948gpif/2021_4Q_0701_jp.pdf" target="_blank" rel="noopener">annual investment results</a> for the FY to March 2022 last Friday. The investment report makes for interesting reading.</li>
<li>The GPIF made 5.42% but alpha was negative 6bp vs time-weighted and money-weighted benchmarks.</li>
<li>The re-allocations amongst asset classes now means more money tracks TOPIX, and it means active managers have their work cut out for them going forward.</li>
</ul>


The GPIF reported its annual investment results for the FY to March 2022 last Friday. The investment report makes for interesting reading.
The GPIF made 5.42% but alpha was negative 6bp vs time-weighted and money-weighted benchmarks.
The re-allocations amongst asset classes now means more money tracks TOPIX, and it means active managers have their work cut out for them going forward.


Executive Director, Metrical Inc

Aki Matsumoto

Executive Director

Independent Leading Corporate Governance Research

Metrical Inc

METRICAL INC. is an independent leading Corporate Governance research firm in Japan where Corporate Governance is increasingly recognized as an important element on corporate management in these days. Thus, CG research and solutions would become an essential component of global capital markets and play important to contribute to transparency of the markets and maximize shareholders’ value in Japan. 

METRICAL INC. provides Corporate Governance research and analysis including rating services, and  also offers investment research and IR services with solutions and customized profound research on CG and IR issues.

<ul>
<li>While we want to believe that "increased awareness of corporate governance has led to downward trend in the concentration of AGM dates," in reality they were spread over 3 days.</li>
<li>The use of the platform for electronic exercise of voting rights has made progress since it was included in the listing criteria for the prime market.</li>
<li>The provision of convocation notices in English has not made much progress since it was not specifically stated in the Corporate Governance Code, which was included in the listing criteria.</li>
</ul>


While we want to believe that "increased awareness of corporate governance has led to downward trend in the concentration of AGM dates," in reality they were spread over 3 days.
The use of the platform for electronic exercise of voting rights has made progress since it was included in the listing criteria for the prime market.
The provision of convocation notices in English has not made much progress since it was not specifically stated in the Corporate Governance Code, which was included in the listing criteria.


Reason for the Declining Concentration of June AGM Dates in Japan Is Likely Mixed

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>Broad global MSCI equity indexes (ACWI,ACWI ex-U.S.,EAFE, and EM) remain bearish with YTD downtrends intact. Until these indexes reverse downtrends, we are bearish and view bounces as bear market rallies.</li>
<li>Major non-U.S. countries appear to be much further along in the bottoming process, a potential sign that U.S. indexes could take a back seat once global equities finally bottom.</li>
<li>Indexes that have not made a new low since March: Nikkei 225, TOPIX, TOPIX Small, Hang Seng, Europe’s EURO STOXX 50, and China's MSCI China (MCHI-US) and China Internet (KWEB-US).</li>
</ul>


Broad global MSCI equity indexes (ACWI,ACWI ex-U.S.,EAFE, and EM) remain bearish with YTD downtrends intact. Until these indexes reverse downtrends, we are bearish and view bounces as bear market rallies.
Major non-U.S. countries appear to be much further along in the bottoming process, a potential sign that U.S. indexes could take a back seat once global equities finally bottom.
Indexes that have not made a new low since March: Nikkei 225, TOPIX, TOPIX Small, Hang Seng, Europe’s EURO STOXX 50, and China's MSCI China (MCHI-US) and China Internet (KWEB-US).


Hang Seng, MSCI China Near Major Base Breakouts; Bottoms-Up Stock Rec's in Hong Kong, China, & Japan

<ul>
<li>I would like to discuss the Nikkei article, "Japanese asset management companies have decided to steer against a proposal to elect directors for companies that do not have female directors.</li>
<li>The reason why major Japanese investment managers have been reluctant to take action on diversity and governance is likely due to the sales policies of their parent companies,</li>
<li>Companies with higher percentage of women directors the boards have higher stock prices. I would like to encourage both investment managers and companies to accelerate their efforts in the future.</li>
</ul>


I would like to discuss the Nikkei article, "Japanese asset management companies have decided to steer against a proposal to elect directors for companies that do not have female directors.
The reason why major Japanese investment managers have been reluctant to take action on diversity and governance is likely due to the sales policies of their parent companies,
Companies with higher percentage of women directors the boards have higher stock prices. I would like to encourage both investment managers and companies to accelerate their efforts in the future.


The Adoption of the Presence of Female Directors as a Criterion for Voting Was Finally a First Step

<ul>
<li>I would like to discuss the Nikkei article titled "EY Survey Legal Managers on Awareness of Sustainable Society."</li>
<li>The survey also included responses from Japanese companies, stating that "many legal departments in Japanese companies do not have sufficient systems in place to deal with ESG and other issues.</li>
<li>The question is how seriously management is discussing how to deal with these issues, as many Japanese companies do not have sufficient human resources, not only in their legal departments. </li>
</ul>


I would like to discuss the Nikkei article titled "EY Survey Legal Managers on Awareness of Sustainable Society."
The survey also included responses from Japanese companies, stating that "many legal departments in Japanese companies do not have sufficient systems in place to deal with ESG and other issues.
The question is how seriously management is discussing how to deal with these issues, as many Japanese companies do not have sufficient human resources, not only in their legal departments. 


Challenge Is How to Promote Sustainability in a Japanese Company that Has Inadequate Human Resources

Japan

The TOPIX, also known as the Tokyo Stock Price Index, is a capitalization-weighted index of all companies listed on the First Section of the Tokyo Stock Exchange. The index is supplemented by the subindices of the 33 industry sectors. The index calculation excludes temporary issues and preferred stocks, and has a base value of 100 as of January 4, 1968.

TSE Tokyo Price Index TOPIX (TPX INDEX)

JAPAN PASSIVE - The GPIF in FY2021

The GPIF last Friday reported its annual results to March 2022 and in the report, there were pointed comments about risk, risk mitigation...

Travis Lundy

Reason for the Declining Concentration of June AGM Dates in Japan Is Likely Mixed

The Nikkei Shimbun carried an article titled "June General Meetings Peak on 29th, Concentration Rate Lowest at 26%, Diversified by Governing...

Metrical Inc

Hang Seng, MSCI China Near Major Base Breakouts; Bottoms-Up Stock Rec's in Hong Kong, China, & Japan

Hong Kong's Hang Seng and China's $MCHI and $KWEB are near major base breakouts. We are watching is 22,700 on Hang Seng and $56.60 on MCHI; we are...

Vermilion Research

The Adoption of the Presence of Female Directors as a Criterion for Voting Was Finally a First Step

I would like to discuss the Nikkei article, "Japanese asset management companies have decided to steer against a proposal to elect directors for...

Metrical Inc

Challenge Is How to Promote Sustainability in a Japanese Company that Has Inadequate Human Resources

I would like to discuss what challenges there are for Japanese companies with regard to the Nikkei article titled "Global Survey on the Status of...

Metrical Inc