Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

I investigate special situations, pairs, and index rebalancing trades in Korea.

Korea / Special Sits, Pairs, Index Rebalancing

Kumyang's Capital Raise Drop: Breaking It Down from an Arb Trading Play

Connecting the Dots Between Kum Yang’s Rights Offer & Global Index November Review

Clearing up the FSS's Authority on Capital Increases in Korea: Korea Zinc & Kum Yang

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Equity Capital Markets

<ul>
<li>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.</li>
<li>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.</li>
<li>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.</li>
</ul>


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.


Finding Unusual Arbitrage Angles in Kumyang's Effectively Pre-Announced Capital Increase