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>One name is screened to newly join the index. That is Kum Yang (001570 KS). With a YTD performance of over 400%, it is currently in very safe territory.</li>
<li>Two constituents stand out as likely deletes at this point: Zinus (013890 KS) and Hwaseung Enterprise (241590 KS). The market cap gap with the next ones in line isn't small.</li>
<li>Kum Yang's passive impact is substantially low due to the recent surge in TV. But if it moves sideways and TV stabilizes downward, we should build preemptive flow trade setups. </li>
</ul>


One name is screened to newly join the index. That is Kum Yang (001570 KS). With a YTD performance of over 400%, it is currently in very safe territory.
Two constituents stand out as likely deletes at this point: Zinus (013890 KS) and Hwaseung Enterprise (241590 KS). The market cap gap with the next ones in line isn't small.
Kum Yang's passive impact is substantially low due to the recent surge in TV. But if it moves sideways and TV stabilizes downward, we should build preemptive flow trade setups. 


KOSPI 200 Rebalancing Early Preview: Few Names Stand Out

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<ul>
<li>It was announced after the market today (18 November) that SK Networks (001740 KS) will acquire a 40% stake in Zinus (013890 KS) for 1.1 trillion won. </li>
<li>For now, SK Networks, which is already highly leveraged, has yet to reveal exactly how it will fund this acquisition. </li>
<li>We believe that the market will have a slightly positive view on Zinus and a negative view on SK Networks in the near future based on this M&amp;A deal.</li>
</ul>


It was announced after the market today (18 November) that SK Networks (001740 KS) will acquire a 40% stake in Zinus (013890 KS) for 1.1 trillion won. 
For now, SK Networks, which is already highly leveraged, has yet to reveal exactly how it will fund this acquisition. 
We believe that the market will have a slightly positive view on Zinus and a negative view on SK Networks in the near future based on this M&amp;A deal.


SK Networks Plans to Acquire a 40% Stake in Zinus for 1.1 Trillion Won

Cross Asset Strategy

In this insight, we provide a comprehensive list of 24 stocks in Korea that provided differentiated dividends to its shareholders in 2020. These 24 stocks on average have been big alpha generators this year and they are up on average 32.4% YTD, outperforming KOSPI and KOSDAQ that are up 9.2% and 4.6%, respectively YTD. The average dividend yields of these 24 stocks are 2.3%.<div class="content-highlight">
All in all, the differentiated dividend paying stocks have been big alpha generators this year. However, we want to emphasize that the past performance do not predict future results and that these alpha generating returns may not occur again next year for this group of stocks. Among the 24 stocks below, we would focus on the top 5-10 market caps for a potential basket related strategy including the differentiated dividend paying stocks in Korea.
The top five market cap stocks in this list include the following:
<ul>
<li>Kumho Petrochem</li>
<li>Doosan</li>
<li>Zinus</li>
<li>Seah Besteel</li>
<li>Orion Holdings</li>
</ul>
</div>

In this insight, we provide a comprehensive list of 24 stocks in Korea that provided differentiated dividends to its shareholders in 2020. These 24 stocks on average have been big alpha generators this year and they are up on average 32.4% YTD, outperforming KOSPI and KOSDAQ that are up 9.2% and 4.6%, respectively YTD. The average dividend yields of these 24 stocks are 2.3%.
All in all, the differentiated dividend paying stocks have been big alpha generators this year. However, we want to emphasize that the past performance do not predict future results and that these alpha generating returns may not occur again next year for this group of stocks. Among the 24 stocks below, we would focus on the top 5-10 market caps for a potential basket related strategy including the differentiated dividend paying stocks in Korea.
The top five market cap stocks in this list include the following:

Kumho Petrochem
Doosan
Zinus
Seah Besteel
Orion Holdings



Alpha Generation from Differentiated Dividend Paying Stocks in Korea

The Korea Exchange announced its KOSDAQ150 and KRX300 indices rebalances today. There were 17 new additions and 17 deletions for KOSDAQ150. Most of the stocks that were expected to be included in KOSDAQ 150 were officially included in the rebalance. However there were a few surprises. For example <a href="https://www.smartkarma.com/entities/nanos-co-ltd" target="_blank" data-smartkarma-citation="entities:16796:1" rel="noopener">Nanos Co Ltd (151910 KS),</a>which was one of the stocks that was expected to be included in KOSDAQ150, did not get included in this indext this time. On the other hand, the following stocks including <a href="https://www.smartkarma.com/entities/sang-a-frontec-co-ltd" target="_blank" data-smartkarma-citation="entities:20692:1" rel="noopener">Sang A Frontec (089980 KS)</a>, Novarex (194700 KS(, CIS (222080 KS), MedPacto (215980 KS), <a href="https://www.smartkarma.com/entities/koreacenter-com-co-ltd" target="_blank" data-smartkarma-citation="entities:28329:1" rel="noopener">Koreacenter.com Co Ltd (290510 KS)</a>, and Soulbrain (357780 KS) which were not on the top of the lists of getting selected into the KOSDAQ150 index by the locals, were formally selected be part of the new KOSDAQ150 inclusions.  The Korea Exchange also made changes to the KRX300 index. Although the KRX300 index is not currently as important as KOSPI200 and KOSDAQ150 indices, it is increasingly gaining in importance among the local institutional investors. The KRX300 had 33 new additions and 35 deletions.

The Korea Exchange announced its KOSDAQ150 and KRX300 indices rebalances today. There were 17 new additions and 17 deletions for KOSDAQ150. Most of the stocks that were expected to be included in KOSDAQ 150 were officially included in the rebalance. However there were a few surprises. For example Nanos Co Ltd (151910 KS),which was one of the stocks that was expected to be included in KOSDAQ150, did not get included in this indext this time. On the other hand, the following stocks including Sang A Frontec (089980 KS), Novarex (194700 KS(, CIS (222080 KS), MedPacto (215980 KS), Koreacenter.com Co Ltd (290510 KS), and Soulbrain (357780 KS) which were not on the top of the lists of getting selected into the KOSDAQ150 index by the locals, were formally selected be part of the new KOSDAQ150 inclusions.  The Korea Exchange also made changes to the KRX300 index. Although the KRX300 index is not currently as important as KOSPI200 and KOSDAQ150 indices, it is increasingly gaining in importance among the local institutional investors. The KRX300 had 33 new additions and 35 deletions. 

KOSDAQ150 and KRX300 Indices Rebalances (Overlapping Additions & Deletions)

KRX announced the rebalance to the KOSPI200 index today. There was not much surprise among the new 10 additions, which included stocks such as Samyang Foods, Zinus, and Kiwoom Securities. However, there was some surprises among the deletions including Unid, <a href="https://www.smartkarma.com/entities/dong-a-socio-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:4271:1" rel="noopener">Dong A Socio Holdings (000640 KS), </a>and <a href="https://www.smartkarma.com/entities/dong-a-st-co-ltd" target="_blank" data-smartkarma-citation="entities:16873:1" rel="noopener">Dong A St (170900 KS)</a>.Among the newly included companies, in terms of their fundamental business outlook and reasonable valuations, we think Samyang Foods, Zinus, and Hanwha Systems fit into these categories. We would be cautious on Big Hit Entertainment, CS Wind, and Shinpoong Pharm as we think there could be some sellers on investors that trade on the "sell on news" strategy of being included in KOSPI 200.

KRX announced the rebalance to the KOSPI200 index today. There was not much surprise among the new 10 additions, which included stocks such as Samyang Foods, Zinus, and Kiwoom Securities. However, there was some surprises among the deletions including Unid, Dong A Socio Holdings (000640 KS), and Dong A St (170900 KS).Among the newly included companies, in terms of their fundamental business outlook and reasonable valuations, we think Samyang Foods, Zinus, and Hanwha Systems fit into these categories. We would be cautious on Big Hit Entertainment, CS Wind, and Shinpoong Pharm as we think there could be some sellers on investors that trade on the "sell on news" strategy of being included in KOSPI 200.  

KOSPI 200 Index Rebalances: No Surprises Among Additions, A Few Surprises Among Deletions

South Korea

Zinus Inc. wholesales and distributes household furniture. The Company wholesales and distributes bed frames, sofas, platform beds, mattresses, and other related products. Zinus markets its products worldwide.

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Zinus (013890 KS)

KOSPI 200 Rebalancing Early Preview: Few Names Stand Out

This post provides an early preview of the KOSPI 200 rebalancing. Several names stand out as likely constituent changes, including Kum Yang,...

Sanghyun Park

SK Networks Plans to Acquire a 40% Stake in Zinus for 1.1 Trillion Won

It was announced after the market today (18 November) that SK Networks (001740 KS) will acquire a 40% stake in Zinus (013890 KS) for 1.1 trillion won.

Douglas Kim

Alpha Generation from Differentiated Dividend Paying Stocks in Korea

We provide a comprehensive list of 24 stocks in Korea that provided differentiated dividends to its shareholders in 2020. These stocks on average...

Douglas Kim

KOSDAQ150 and KRX300 Indices Rebalances (Overlapping Additions & Deletions)

We highlight the KOSDAQ150 and KRX300 indices rebalances. There are some interesting new names, especially among those that are over lapping in...

Douglas Kim

KOSPI 200 Index Rebalances: No Surprises Among Additions, A Few Surprises Among Deletions

KRX anounced its KOSPI200 index rebalance. There were no surprises among the new additions but a few surprises among the deletions.

Douglas Kim

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