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

Brian Freitas

Highly experienced ex-Delta One trader with 17 years of experience trading arbitrage and related strategies across Asian markets.

Exempt Financial Adviser (EFA) under CrossASEAN Research Pte Ltd.

It is important to note that the information provided by Periscope Analytics is based on publicly available data and own knowledge, which has been gathered and synthesized from a variety of sources. While every effort has been made to ensure the accuracy and completeness of the information provided, it is not guaranteed to be free from errors or omissions.

All forecasts and estimates are based on information that has been obtained from public sources that are considered to be reliable. The sources include, but are not limited to, company announcements, exchange filings, ETF and other passive investment vehicle holdings, and free float and volume data from third-party data providers. Periscope Analytics does not guarantee the accuracy and completeness of the forecasts, estimates and/or other information.

Pan-Asia Index Rebalances/ Events/ Delta One

Event-Driven

Over the last year, <a href="https://www.smartkarma.com/entities/gf-securities-co-ltd-h" target="_blank" rel="noopener" data-smartkarma-citation="entities:338:1">Gf Securities Co Ltd (H) (1776 HK)</a> has underperformed <a href="https://www.smartkarma.com/entities/china-galaxy-securities-co-h" target="_blank" rel="noopener" data-smartkarma-citation="entities:165:1">China Galaxy Securities Company (6881 HK)</a> by 40% on a total return basis. While the price to book ratio for both stocks has been decreasing, the spread between the price to book ratio for the two stocks is near its lowest point over the last three years.<a href="https://www.smartkarma.com/entities/gf-securities-co-ltd-h" target="_blank" rel="noopener" data-smartkarma-citation="entities:338:1">Gf Securities Co Ltd (H) (1776 HK)</a> has started to outperform <a href="https://www.smartkarma.com/entities/china-galaxy-securities-co-h" target="_blank" rel="noopener" data-smartkarma-citation="entities:165:1">China Galaxy Securities Company (6881 HK)</a> over the last three months and we feel that the outperformance should continue, especially with <a href="https://www.smartkarma.com/entities/gf-securities-co-ltd-h" target="_blank" rel="noopener" data-smartkarma-citation="entities:338:1">Gf Securities Co Ltd (H) (1776 HK)</a> posting very good revenue and profit numbers for November 2019.We recommend going long <a href="https://www.smartkarma.com/entities/gf-securities-co-ltd-h" target="_blank" rel="noopener" data-smartkarma-citation="entities:338:1">Gf Securities Co Ltd (H) (1776 HK)</a> and short <a href="https://www.smartkarma.com/entities/china-galaxy-securities-co-h" target="_blank" rel="noopener" data-smartkarma-citation="entities:165:1">China Galaxy Securities Company (6881 HK)</a> for a 10% return over the next few months.

Over the last year, Gf Securities Co Ltd (H) (1776 HK) has underperformed China Galaxy Securities Company (6881 HK) by 40% on a total return basis. While the price to book ratio for both stocks has been decreasing, the spread between the price to book ratio for the two stocks is near its lowest point over the last three years.Gf Securities Co Ltd (H) (1776 HK) has started to outperform China Galaxy Securities Company (6881 HK) over the last three months and we feel that the outperformance should continue, especially with Gf Securities Co Ltd (H) (1776 HK) posting very good revenue and profit numbers for November 2019.We recommend going long Gf Securities Co Ltd (H) (1776 HK) and short China Galaxy Securities Company (6881 HK) for a 10% return over the next few months.

China Brokers Pair Trade - GF Securities / China Galaxy Securities

GF Securities (H)

China Brokers Pair Trade - GF Securities / China Galaxy Securities