In today’s briefing:
- July TOPIX FFW Rebal – Bigger Than Expected
- Korea – A Look at Ecopro, Kumyang & JYP Entertainment
- EQD | S&P500 E-Mini (ES) DAILY SHORT, Speculative High-Probability Trade
- Industrivärden H1, Discount and Target NAV
July TOPIX FFW Rebal – Bigger Than Expected
- Last Friday, the FFW changes for the TOPIX July Free Float Weight Review were announced. There have also been other recent announcements creating flows on 30 July.
- Some of these other recent announcements represent a possible change in ad hoc methodology.
- Total Flow for 30 July is ~$3.3bn a side driven by selling flows (3/4 of the buy flows are reverse funding). $2.1bn of selling is > 3 days ADV.
Korea – A Look at Ecopro, Kumyang & JYP Entertainment
- We take a look at Ecopro Co Ltd (086520 KS), Kum Yang (001570 KS) and Jyp Entertainment (035900 KS) since they appear to be on investor radars.
- Foreign investors have been buyers while retail have been sellers in Ecopro Co and Kum Yang over the last month, while foreign investors have continued to buy Jyp Entertainment.
- Short interest on all stocks has dropped over the last month, though there has been a recent tick up in shorts on Jyp Entertainment (035900 KS).
EQD | S&P500 E-Mini (ES) DAILY SHORT, Speculative High-Probability Trade
- The S&P500 E-Mini (ES) is approaching a DAILY resistance level at a point in time where it could perform a quick reversal – a SHORT trade opportunity.
- Watch the 4483-4525 price area, today is the 3rd consecutive day up, the reversal could begin in that area, today or tomorrow.
- The probability for a quick reversal, after 3 days up, in the 4483-4525 price area, is between 67% to 79%, depending on the resistance levels reached.
Industrivärden H1, Discount and Target NAV
- The discount to NAV of C shares is 7.4%, well below the “usual” 15% conglomerate discount, and also below the 5-year average of 10%.
- C shares are trading at a 0.3% discount to A shares. The reduction in the discount could be driven by acquisitions by the Lundbergs of C shares.
- My target NAV is SEK 158,144 million, a 18% increase. My target TP for the C shares of Industrivärden, assuming a 10% discount to NAV, is SEK 329.5 (15% higher).
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