Alpha-Centric ESG Research

Kyle Rudden

Thematic (Sector/Industry)

<ul><li>New SGX climate-related disclosure requirements based on ISSB's standards are more stringent than current requirements, most notably regarding mandatory Scope 3 emissions reporting.</li><li>The implications for S-REITs are significant. Real Estate is one of the most emissions-intensive sectors, and Scope 3 emissions comprise 85-95% of total emissions for real estate companies.</li><li>Motivated by a strong "business case" for best-in-class climate performance and transparency, many S-REITs are ahead of the curve, evidenced by prominence in climate-related indexes.</li></ul>

New SGX climate-related disclosure requirements based on ISSB's standards are more stringent than current requirements, most notably regarding mandatory Scope 3 emissions reporting.The implications for S-REITs are significant. Real Estate is one of the most emissions-intensive sectors, and Scope 3 emissions comprise 85-95% of total emissions for real estate companies.Motivated by a strong "business case" for best-in-class climate performance and transparency, many S-REITs are ahead of the curve, evidenced by prominence in climate-related indexes.

S-REITs: Climate Disclosures and Inclusion in ESG-Related Equity Indexes

AlphaSituations-Event/Catalyst Driven Research, AlphaSituations

Robert Sassoon

AlphaSituations-Event/Catalyst Driven Research

AlphaSituations

Since its establishment, AlphaSituations has delivered a track record of outperformance with a hit rate of winners of more than 70% of its portfolio of ideas generating annualized average returns of 20%. In January 2022, AlphaSituations was contracted by Water Tower Research, an investor engagement and stakeholder communication platform to provide coverage of Special Situations

Event-Driven

<ul>
<li>The <a href="https://www.smartkarma.com/entities/healthcare-realty-trust-inc" target="_blank" data-smartkarma-citation="entities:7003:1" rel="noopener">Healthcare Realty Trust (HR US)</a> / <a href="https://www.smartkarma.com/entities/healthcare-trust-of-america-inc" target="_blank" data-smartkarma-citation="entities:8302:1" rel="noopener">Healthcare Trust Of America (HTA US)</a> transaction is heading towards climax with the critical HR and HTA shareholder votes set for July 15 </li>
<li>The odds are that activist investor and HR shareholder will not succeed in derailing the deal which it opposes from closing on July 20 </li>
<li>Notwithstanding the significant spread compression seen in recent weeks, there remains an attractive short-term opportunity for the arbs  </li>
</ul>


The Healthcare Realty Trust (HR US) / Healthcare Trust Of America (HTA US) transaction is heading towards climax with the critical HR and HTA shareholder votes set for July 15 
The odds are that activist investor and HR shareholder will not succeed in derailing the deal which it opposes from closing on July 20 
Notwithstanding the significant spread compression seen in recent weeks, there remains an attractive short-term opportunity for the arbs  


MergerTalk: Healthcare Realty/ HealthCare Trust - Short-Term Risk-Arb Opportunity

The Biden-Harris administration recently announced four "Day One" priorities, the first of which is their COVID-19 response plan. COVID-19 response is first, because it is a prerequisite to economic recovery, which is the second of their four "Day One" priorities.Several investment themes are inherent in Biden's COVID-19 plan, some more direct and obvious than others. This Insight overviews more significant themes and their most representative stocks, in three sections (the first two will be expanded on in separate upcoming reports):<ol>
<li>
COVID-19 Testing: Testing is the largest, most tangible, nearest-term investment opportunity created by Biden's plan. An estimated US$75-100 billion for testing could be windfall for certain stocks, but not all. Selectivity is key, and timing is critical (related to vaccine development).</li>
<li>
Vaccine Delivery: Biden's plan emphasises vaccine manufacturing and delivery, versus vaccine development (Trump had allocated <a href="https://www.hhs.gov/coronavirus/explaining-operation-warp-speed/index.html" target="_blank" rel="noopener">billions</a> to vaccine development companies). Some might go to big pharma companies for M&amp;D, but most should benefit other "cold chain" stocks.</li>
<li>
PPE Supply/Other: PPE manufacturing, of course, but that is largely old news. I will address it, but do so along with other more interesting collateral themes. For example, retail drugs chains, elder-care, medical technologies, and a few other related industries.</li>
</ol>

The Biden-Harris administration recently announced four "Day One" priorities, the first of which is their COVID-19 response plan. COVID-19 response is first, because it is a prerequisite to economic recovery, which is the second of their four "Day One" priorities.Several investment themes are inherent in Biden's COVID-19 plan, some more direct and obvious than others. This Insight overviews more significant themes and their most representative stocks, in three sections (the first two will be expanded on in separate upcoming reports):

COVID-19 Testing: Testing is the largest, most tangible, nearest-term investment opportunity created by Biden's plan. An estimated US$75-100 billion for testing could be windfall for certain stocks, but not all. Selectivity is key, and timing is critical (related to vaccine development).

Vaccine Delivery: Biden's plan emphasises vaccine manufacturing and delivery, versus vaccine development (Trump had allocated billions to vaccine development companies). Some might go to big pharma companies for M&amp;D, but most should benefit other "cold chain" stocks.

PPE Supply/Other: PPE manufacturing, of course, but that is largely old news. I will address it, but do so along with other more interesting collateral themes. For example, retail drugs chains, elder-care, medical technologies, and a few other related industries.


Biden COVID-19 Response Plan: Overview of Its Inherent Investment Themes

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

In this report, we analyse the staggering inflows into US passive equity funds over the past 6 years, identify the key players and how these inflows translate to the holdings in the underlying companies.  We compare this picture with $1tr in actively managed funds in the US and find a stark difference in fortunes.  We propose that the switch from passive to active has affected the ability of active managers to consistently outperform and highlight some of the stocks riding on the wave of the passive inflows, yet roundly ignored by the active investor community.

In this report, we analyse the staggering inflows into US passive equity funds over the past 6 years, identify the key players and how these inflows translate to the holdings in the underlying companies.  We compare this picture with $1tr in actively managed funds in the US and find a stark difference in fortunes.  We propose that the switch from passive to active has affected the ability of active managers to consistently outperform and highlight some of the stocks riding on the wave of the passive inflows, yet roundly ignored by the active investor community.  

Passive Vs Active:  ETF Flows Dominate, Stock Prices Distorted, Active Managers on the Ropes

Amareos

Ryan Shea

Summary: Housing has several characteristics that mean it is almost perfectly designed to be prone to bubble-like behaviour. By definition a bubble occurs when the price of an asset is significantly overvalued making it increasingly difficult to justify based on underlying fundamentals. In such situations it is the overriding optimism of the crowd, with unrealistically high expectations, that acts as the propellant for further gains. Ten years on from the bursting of the US housing market…

Summary: Housing has several characteristics that mean it is almost perfectly designed to be prone to bubble-like behaviour. By definition a bubble occurs when the price of an asset is significantly overvalued making it increasingly difficult to justify based on underlying fundamentals. In such situations it is the overriding optimism of the crowd, with unrealistically high expectations, that acts as the propellant for further gains. Ten years on from the bursting of the US housing market…

The Market Sentimentalist: Global Real Estate – Where Are The Risks Residing?

United States

Welltower Inc. is a real estate investment trust. The Company invests in seniors housing operators, post-acute providers, and health systems, and delivers the health care infrastructure necessary to facilitate better treatment. Welltower serves customers in the United States, Canada, and the United Kingdom.

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Welltower (WELL US)

MergerTalk: Healthcare Realty/ HealthCare Trust - Short-Term Risk-Arb Opportunity

Notwithstanding the significant spread compression seen in recent weeks, there remains an attractive short-term opportunity for the arbs as the...

Robert Sassoon

Biden COVID-19 Response Plan: Overview of Its Inherent Investment Themes

Biden's recently-announced COVID-19 response plan suggests a number of investment themes. This Insight overviews the more significant of those...

Kyle Rudden

Passive Vs Active: ETF Flows Dominate, Stock Prices Distorted, Active Managers on the Ropes

In this report, we analyse the staggering inflows into US passive equity funds over the past 6 years, identify the key players and how these...

Steven Holden

The Market Sentimentalist: Global Real Estate – Where Are The Risks Residing?

Summary: Housing has several characteristics that mean it is almost perfectly designed to be prone to bubble-like behaviour. By definition a bubble...

Amareos

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S-REITs: Climate Disclosures and Inclusion in ESG-Related Equity Indexes

​New SGX climate-related disclosure requirements based on ISSB's standards are more stringent than current requirements, most notably regarding...

Kyle Rudden

MergerTalk: Healthcare Realty/ HealthCare Trust - Short-Term Risk-Arb Opportunity

Notwithstanding the significant spread compression seen in recent weeks, there remains an attractive short-term opportunity for the arbs as the...

Robert Sassoon

Biden COVID-19 Response Plan: Overview of Its Inherent Investment Themes

Biden's recently-announced COVID-19 response plan suggests a number of investment themes. This Insight overviews the more significant of those...

Kyle Rudden

Passive Vs Active: ETF Flows Dominate, Stock Prices Distorted, Active Managers on the Ropes

In this report, we analyse the staggering inflows into US passive equity funds over the past 6 years, identify the key players and how these...

Steven Holden

The Market Sentimentalist: Global Real Estate – Where Are The Risks Residing?

Summary: Housing has several characteristics that mean it is almost perfectly designed to be prone to bubble-like behaviour. By definition a bubble...

Amareos

New SGX climate-related disclosure requirements based on ISSB's standards are more stringent than current requirements, most notably regarding...