In today’s briefing:
- Important Rule Changes in Block Deals Pre-Disclosure in Korea: Analyzing Trading Dynamics
- Lasertec (6920) – The State of Things May Be Different Than You Think
- Quiddity Primer for CSI 300/500 Index Rebalance Events
Important Rule Changes in Block Deals Pre-Disclosure in Korea: Analyzing Trading Dynamics
- Insiders holding more than 10% of SO must disclose block deals 30 days in advance if they plan to sell more than 1% of SO or an amount exceeding ₩5B.
- The trading window and pricing range for short positions, based on the assumption of deal-taking, will likely vary significantly as the timing of price reflection will see a drastic change.
- There is an increasing likelihood that major shareholders will accelerate their planned block deals and bring them to the market in abundance before October.
Lasertec (6920) – The State of Things May Be Different Than You Think
- Lasertec (6920) is a shoo-in for Nikkei 225 inclusion in September according to the quantitative analysis. The amount to buy is a small multiple of ADV, making the inclusion “unimpressive.”
- It is probably worth looking at the details of ownership, of volume, and of relationship to other stocks in the same general sector.
- It is also worth thinking about flow channels (stock up or down changes flows) and forward fundamental calculations.
Quiddity Primer for CSI 300/500 Index Rebalance Events
- CSI 300 represents the 300 largest stocks by market capitalization and liquidity from the entire universe of Shanghai and Shenzhen Stock Exchanges. CSI 500 represents the next largest 500 names.
- During the periodic index rebalance events, a large number of stocks move into or out of these indices giving rise to significant flow events and attractive trading opportunities.
- In this insight, we take a brief look at the index selection methodology and the historical price and volume performance of the CSI 300/500 index rebalance baskets.
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