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

Thematic (Sector/Industry)

<ul>
<li>Over the past decade, Cyclical sectors have traded places with Sensitive sectors as the largest allocation among active Asia Ex-Japan investors. </li>
<li>The last cycle started in early 2019 and saw Sensitive overtake Cyclicals and move to a key overweight, but this peaked in mid-2021 and has started to reverse.</li>
<li>The major rotation on the year so far has been a scaling back of Technology and Communication Services allocations in favour of Financials and Consumer Discretionary/Staples</li>
</ul>


Over the past decade, Cyclical sectors have traded places with Sensitive sectors as the largest allocation among active Asia Ex-Japan investors. 
The last cycle started in early 2019 and saw Sensitive overtake Cyclicals and move to a key overweight, but this peaked in mid-2021 and has started to reverse.
The major rotation on the year so far has been a scaling back of Technology and Communication Services allocations in favour of Financials and Consumer Discretionary/Staples


Asia Ex-Japan:  Tech to Financials Rotation

Asia biased macro & technical analysis, Untying The Gordian Knot

Untying The Gordian Knot

Asia biased macro & technical analysis

A differentiated process with a primary focus on Asia. Technical Analysis as core and Macro drivers that could bring the view to fruition & changes that could make the idea fall apart. The objective is to be the best in class, hence corner shop.

Technical Analysis

<ul><li>Hong Kong Stocks are more excited than the mainland about cutting the Quarantine period from 14 to 7 days.</li><li>The 25th Anniversary of the Hong Kong handover means more stability ahead of celebrations and trading dominated by position squaring.</li><li>Only Xiaomi shows signs of a breakout. It broke the downtrend from August 2021 with the inside days in the last two trading sessions. It looks like it will test the breakout and cover it next week.</li></ul>

Hong Kong Stocks are more excited than the mainland about cutting the Quarantine period from 14 to 7 days.The 25th Anniversary of the Hong Kong handover means more stability ahead of celebrations and trading dominated by position squaring.Only Xiaomi shows signs of a breakout. It broke the downtrend from August 2021 with the inside days in the last two trading sessions. It looks like it will test the breakout and cover it next week.

Hang Seng Index Constituents 30th June 2022

Country Garden Holdings Co / Technical Analysis

<ul><li>The government has taken several steps to improve supply-side restrictions on first and second homes.</li><li>PBOC has added policy support by cutting longer-dated LPR rates for home loan pricing. Longfor Group and Country Garden are highly rated, large China Real Estate developers.</li><li>They do not seem to respond positively to many tailwinds</li></ul>

The government has taken several steps to improve supply-side restrictions on first and second homes.PBOC has added policy support by cutting longer-dated LPR rates for home loan pricing. Longfor Group and Country Garden are highly rated, large China Real Estate developers.They do not seem to respond positively to many tailwinds

Hang Seng Index Constituents 2nd June 2022

Asian Insight Provider - Actionable ideas, CrossASEAN Research

Henry Soediarko

Asian Insight Provider - Actionable ideas

CrossASEAN Research

At CrossASEAN Research we strive to produce unbiased and differentiated on the ground insights on companies across South East Asia. Our Research is produced for the most part after face to face meetings and conversations with company management to dig deep into the long term vision and strategy of the companies we cover. We seek to deliver investable and actionable themes on sectors and markets across SE Asia, often in collaboration with other Insight Providers across the region, pooling the vast experience of the analysts within the Smartkarma Ecosystem. We also offer bespoke work and tailor made trips for our clients. 

Insights across South East Asia

Equity Bottom-Up

<ul>
<li>The correlation between <a href="https://www.smartkarma.com/entities/xinyi-glass-holdings-ltd" target="_blank" data-smartkarma-citation="entities:11940:1" rel="noopener">Xinyi Glass Holdings (868 HK)</a> and <a href="https://www.smartkarma.com/entities/flat-glass-group-ltd" target="_blank" data-smartkarma-citation="entities:1108:1" rel="noopener">Flat Glass (6865 HK)</a> has narrowed thus it is time to lock the profit while it is still possible.</li>
<li>Xinyi Glass formed a JV with <a href="https://www.smartkarma.com/entities/xinyi-solar-holdings-ltd" target="_blank" data-smartkarma-citation="entities:318:1" rel="noopener">Xinyi Solar Holdings (968 HK)</a> to set up a polysilicon manufacturing facility. </li>
<li>A 7% dividend with some potential growth juice from owning the shares at less than 7x PER is really quite a steal.</li>
</ul>


The correlation between Xinyi Glass Holdings (868 HK) and Flat Glass (6865 HK) has narrowed thus it is time to lock the profit while it is still possible.
Xinyi Glass formed a JV with Xinyi Solar Holdings (968 HK) to set up a polysilicon manufacturing facility. 
A 7% dividend with some potential growth juice from owning the shares at less than 7x PER is really quite a steal.


Xinyi Glass Vs Flat Glass: Collapse and Long XYG

Pan-Asia Index Rebalances/ Events/ Delta One, Periscope Analytics

Brian Freitas

Pan-Asia Index Rebalances/ Events/ Delta One

Periscope Analytics

Periscope Analytics focuses on event-driven trades across Asia Pacific and provides comprehensive, timely and systematic coverage of index changes to major Asia Pacific indices in a structured manner.

The analysis includes forecasted inclusions and exclusions to all major Asian indices that have significant amount of tracking assets, including estimates of passive buy/sell flow on the stocks. The service also provides commentary and impact of market consultations, ground rule changes, and other events (IPOs, spin-offs, M&A) that could lead to index changes and passive flow.

Periscope Analytics works with multi-strategy hedge funds, proprietary trading firms, stat arb trading groups and long-only investors that invest and trade in the Asia Pacific region with the data being used to trade index rebalances, avoid pre-positioning and passive flow, and to time entry into and exit from stocks.

Event-Driven Trades Across Asia Pacific

Event-Driven

<ul>
<li>There are 12 additions to the S&amp;P Global Clean Energy Index for Asia. The changes were announced on 8 April and will be implemented at the close on 22 April.</li>
<li>Largest inflows are on <a href="https://www.smartkarma.com/entities/chubu-electric-power-co-inc" target="_blank" data-smartkarma-citation="entities:14574:1" rel="noopener">Chubu Electric Power</a>, <a href="https://www.smartkarma.com/entities/china-yangtze-power-co-ltd" target="_blank" data-smartkarma-citation="entities:3210:1" rel="noopener">China Yangtze Power</a>, <a href="https://www.smartkarma.com/entities/adani-green-energy-ltd" target="_blank" data-smartkarma-citation="entities:29012:1" rel="noopener">Adani Green Energy</a>, <a href="https://www.smartkarma.com/entities/energy-absolute-pcl" target="_blank" data-smartkarma-citation="entities:10377:1" rel="noopener">Energy Absolute</a>, <a href="https://www.smartkarma.com/entities/longi-green-energy-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:12703:1" rel="noopener">LONGi Green Energy Technology</a>, <a href="https://www.smartkarma.com/entities/ja-solar-technology-co-ltd" target="_blank" data-smartkarma-citation="entities:16597:1" rel="noopener">JA Solar Technology</a>, <a href="https://www.smartkarma.com/entities/tianjin-zhonghuan-semiconductor-co-ltd" target="_blank" data-smartkarma-citation="entities:6791:1" rel="noopener">Tianjin Zhonghuan Semiconductor</a> and <a href="https://www.smartkarma.com/entities/sungrow-power-supply-co-ltd" target="_blank" data-smartkarma-citation="entities:4255:1" rel="noopener">Sungrow Power Supply</a>.</li>
<li>The largest outflows are expected on <a href="https://www.smartkarma.com/entities/meridian-ener-partly-paid-sh" target="_blank" data-smartkarma-citation="entities:4327:1" rel="noopener">Meridian Energy (MEL NZ)</a>, <a href="https://www.smartkarma.com/entities/contact-energy-ltd" target="_blank" data-smartkarma-citation="entities:13136:1" rel="noopener">Contact Energy (CEN NZ)</a> and <a href="https://www.smartkarma.com/entities/xinyi-energy-holdings-ltd" target="_blank" data-smartkarma-citation="entities:27808:1" rel="noopener">Xinyi Energy Holdings Ltd (3868 HK)</a>. </li>
</ul>


There are 12 additions to the S&amp;P Global Clean Energy Index for Asia. The changes were announced on 8 April and will be implemented at the close on 22 April.
Largest inflows are on Chubu Electric Power, China Yangtze Power, Adani Green Energy, Energy Absolute, LONGi Green Energy Technology, JA Solar Technology, Tianjin Zhonghuan Semiconductor and Sungrow Power Supply.
The largest outflows are expected on Meridian Energy (MEL NZ), Contact Energy (CEN NZ) and Xinyi Energy Holdings Ltd (3868 HK). 


S&P Global Clean Energy Index: Changes for Asia & Impact

China

China Oilfield Services Limited provides oilfield services. The Company provides geophysical prospecting, drilling, oilfield technology development, and other services. China Oilfield Services also operates transportation businesses.

Offshore Oil Engineering Co., Ltd. provides offshore oil engineering services, including designing, construction, installation, and repair and maintenance services.  The Company's main businesses include oil/gas exploration engineering, subsea pipeline laying, oil/gas field equipment testing and maintenance, as well as pressure container and steel structure manufacturing.

Pingdingshan Tianan Coal Mining Co., Ltd. operates underground coal mining, coal washing and processing. The company also provides ground transportation services.

Yangquan Coal Industry Group Co Ltd. produces, processes, and sells coal. The Company also generates electricity and heat. Yangquan Coal sells its products domestically and exports to other countries.

Yantai Jereh Oilfield Services Group Co., Ltd develops, manufactures and sells oil field equipment.  The Company's products include well cementing equipment, well fracturing equipment, and natural gas compression and transportation equipment.

Wintime Energy  Co., Ltd. is in coal mining business.  The Company's main businesses are coal mining, investment in the power plant, developing new energy technology, trading business, and rental.

Datong Coal Industry Co., Ltd. operates underground mining, preparation and sales of coal.

Shanxi Meijin Energy Co., Ltd. produces coal and related products.

Shanxi Meijin Energy Co, Ltd. (000723 CH)

Guanghui Energy Co., Ltd. is principally engaged in energy development, automotive services and real estate property leasing. The Company is in the business of coal mining and related coal chemical manufacturing. The Company is also engaged in the processing and distributing of granite materials and trading of general merchandise such as plastic doors and windows.

Jizhong Energy Resources Co., Ltd. produces and markets coal products, generates electric power, and manufactures cement.

Scorpio Tankers Inc. operates as a shipping company. The Company provides seaborne transportation of crude oil and other petroleum products. Scorpio Tankers serves customers worldwide.

Helmerich & Payne, Inc. provides contract drilling of oil and gas wells in the Gulf of Mexico and South America. The Company operates land rigs and platform rigs.

Golar LNG Limited is an independent owner and operator of liquefied Natural Gas (LNG) infrastructure including carriers, Floating Storage and Regasification Units (FSRUs) and Floating Liquefaction (FLNG) vessels.  Collectively these assets make Golar an integrated midstream LNG services provider supporting resource holders, gas producers and consumers.

Patterson-UTI Energy, Inc. provides land-based drilling services to major and independent oil and natural gas companies.  The Company conducts drilling operations in Texas, New Mexico, Utah, Oklahoma, Louisiana, and western Canada. Patterson-UTI is also involved in pressure pumping, oil and gas exploration and production, and drilling and completion fluids services.

Northern Oil and Gas, Inc. is an oil and gas exploration and production company. The Company produces petroleum products. Northern Oil and Gas is currently focused on the Rocky Mountain regions of the United States.

PBF Energy Inc. is an independent petroleum refiner and supplier. The Company offers unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants and other petroleum products in the United States. PBF's finished products are sold through long-term offtake and supply agreements.

California Resources Corporation is an independent oil and natural gas company. The Company focuses on maximizing the value of land, mineral and technical resources for decarbonization by developing carbon capture and storage and other emissions reducing projects. California Resources serves customers in the State of California.

Archrock, Inc. operates as a natural gas contract compression services company. The Company offers natural gas compression and aftermarket services, as well as provides used equipment for oil and gas industry. Archrock serves customers in the United States.

Transocean Ltd. is an offshore drilling contractor.  The Company owns or operates mobile offshore drilling units, inland drilling barges, and other assets utilized in the support of offshore drilling activities worldwide. Transocean specializes in technically demanding segments of the offshore drilling business, including deepwater and harsh environment drilling services.

CNX Resources Corporation operates as a natural gas exploration and production company. The Company owns gas reserves that develop and produce natural gas, including methane and shale beds. CNX Resources serves natural gas industry in the United States.

Xinyi Solar Holdings Limited manufactures solar glass.  The Company produces ultra-clear photovoltaic raw glass and ultra-clear photovoltaic processed glass. Xinyi Solar Holdings offers its products to major solar product component manufactures both domestically and internationally.

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Xinyi Solar Holdings (968 HK)

Asia Ex-Japan: Tech to Financials Rotation

Asia Ex-Japan funds are in the midst of a major rotation out of Technology and Communication Services stocks and in to Financials and Consumer...

Steven Holden

Hang Seng Index Constituents 30th June 2022

Mainland opening, but not really. Hong Kong Stocks are more excited than the mainland about cutting the Quarantine period from 14 to 7 days. The...

Untying The Gordian Knot

Hang Seng Index Constituents 2nd June 2022

The government has taken several steps to improve supply-side restrictions on first and second homes. PBOC has added policy support by cutting...

Untying The Gordian Knot

Xinyi Glass Vs Flat Glass: Collapse and Long XYG

After the Chinese property meltdown in Q3 21, XYG share price collapsed as well. Before that, the stock was trading at mid-20s PER but now it...

Henry Soediarko

S&P Global Clean Energy Index: Changes for Asia & Impact

There are 12 adds for Asia as a part of the S&P Global Clean Energy Index rebal, plus other changes. There have not been any big price moves since...

Brian Freitas

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