In today’s briefing:
- Finding Unusual Arbitrage Angles in Kumyang’s Effectively Pre-Announced Capital Increase
- Hamamatsu Photonics (6965) – Toyota Selling Yet Another Cross-Holding
Finding Unusual Arbitrage Angles in Kumyang’s Effectively Pre-Announced Capital Increase
- The arbitrage is clear: it’s the difference between stock rights/subscription costs and short hedge price. Kumyang’s high market interest and volatility amplify this, suggesting unusual trading angles.
- Kumyang’s futures also show extreme volatility, likely causing excessive backwardation around the ex-rights date and stock rights window, affecting futures-based short hedge positions.
- This opens up the possibility that, depending on entry points, our futures-based short hedge position might temporarily enter an unusual profitable zone relative to the stock rights and subscription costs.
Hamamatsu Photonics (6965) – Toyota Selling Yet Another Cross-Holding
- Today after the close we got news that after a year-plus of Hamamatsu Photonics Kk (6965 JP)‘s sliding stock price, Toyota Motor (7203 JP) is selling their 5+% stake.
- The offering is standard. Probably prices 9 Sep 2024. HP’s amended buyback program and probable index upweights offset most of the offering size over the next several months.
- So investors have to decide whether they want to catch the falling knife.
💡 Before it’s here, it’s on Smartkarma
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