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

Short-Selling Kakao Bank & Krafton Begins Today: Here Are Some Data Worth Checking

Kakao Bank - A Sharp Increase in Fraudulent Accounts

Toss Bank: A Sharp Growth in New Applicants to Take Away Market Share from Kakao Bank & K-Bank

Battle Lines Drawn As BABA Builds Out First/Last-Mile Capacity; But Who Will Fund 75+ Bn CNY CapEx?

Clepsydra Capital

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

Equity Bottom-Up

Short-selling to Kakao Bank is not decreasing. On the contrary, the trend is getting worse. The proportion of short trading in today's total trading volume again hit the 15% level. Today's short VWAP was ₩66,241.<div class="content-highlight">Today's closing price was $65,500, which is actually the lowest since listing. Even at this lowest price, short-selling was made quite aggressively.</div>Today's shorting also has an important meaning in terms of share price trends. Except for September 10, when short selling was allowed, the days with the most short-selling were September 15 and September 16. However, this time, it was a short sale aimed at a price surge right after the share price rose by almost 8% on September 14.However, today, when the stock price has already fallen for three consecutive days, short-selling has reached the level of more than 15% of the trading volume. Rather than a shorting inflow due to a temporary share price rebound, today's should be seen as a short-selling betting on a structural downward trend in Kakao Bank's share price.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/233/021/original/image_27221576321633093091286.png?1633093093" class="editor-image img-responsive" data-smartkarma-image-id="233021"></figure>The daily loan balance (new vs. repaid) below also has interesting implications. Yesterday (September 30), there was a significant level of repayment. There were loan repayments of over 1M, the highest level since short selling was allowed. Yesterday's closing price was ₩68,400, and yesterday's repayment can be interpreted as a partial liquidation of short positions betting on short-term stock price volatility after listing.However, it is worth noting that today's share price has been sufficiently corrected; still, new loans are close to 700K. So, the loan balance returned to close to 15M again. This can be another evidence suggesting a new influx of short-sellers aiming for a structural downturn in Kakao Bank's fundamentals instead of betting on short-term price volatility.<table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
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</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Date"}'>Date</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Newly loaned shares"}'>Newly loaned shares</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Loaned shares repaid"}'>Loaned shares repaid</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Loan balance"}'>Loan balance</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Short interest"}'>Short interest</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Loan balance/Short interest"}'>Loan balance/Short interest</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44449}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 10</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3150200}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,150,200</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":546907}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>546,907</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6940058}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>6,940,058</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1330825}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,330,825</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5.214853943982116}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">5.21x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44452}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 13</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2626620}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>2,626,620</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":216381}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>216,381</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":9350297}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>9,350,297</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1621216}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,621,216</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":5.767459117107159}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">5.77x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44453}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 14</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2605990}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>2,605,990</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":453409}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>453,409</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":11502878}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>11,502,878</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2344735}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>2,344,735</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.905832855312007}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.91x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44454}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 15</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1164047}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,164,047</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":68003}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>68,003</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":12598922}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>12,598,922</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2912744}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>2,912,744</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.3254477564798}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.33x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44455}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 16</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1231797}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,231,797</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":156382}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>156,382</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":13674337}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>13,674,337</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3326154}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,326,154</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.1111557071620854}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.11x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44456}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 17</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":609292}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>609,292</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":263228}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>263,228</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":14020401}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>14,020,401</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3363456}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,363,456</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.168450843418198}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.17x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44462}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 23</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":262003}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>262,003</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":599445}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>599,445</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":13682959}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>13,682,959</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3375519}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,375,519</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.053586722515856}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.05x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44463}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 24</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1513289}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,513,289</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":256602}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>256,602</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":14939646}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>14,939,646</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3229657}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,229,657</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.625768618772829}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.63x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44466}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 27</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1165155}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,165,155</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":617393}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>617,393</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15487408}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>15,487,408</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3282877}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,282,877</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.717632734945598}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.72x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44467}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 28</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":151094}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>151,094</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":318789}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>318,789</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15319713}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>15,319,713</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3317155}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,317,155</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.618328959605445}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.62x</td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44468}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 29</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":256811}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>256,811</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":309072}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>309,072</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15267452}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>15,267,452</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3455668}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>3,455,668</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":4.418089932250436}' data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}' data-sheets-formula="=R[0]C[-2]/R[0]C[-1]">4.42x</td>
</tr>
<tr><td colspan="6"></td></tr>
<tr>
<td data-sheets-value='{"1":3,"3":44469}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>9. 30</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":568014}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>568,014</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1178857}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,178,857</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":14656609}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>14,656,609</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>-</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}'>- </td>
</tr>
<tr>
<td data-sheets-value='{"1":3,"3":44470}' data-sheets-numberformat='{"1":5,"2":"m\". \"d","3":1}'>10. 1</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":655302}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>655,302</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":463995}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>463,995</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":14847916}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>14,847,916</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"-"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>-</td>
<td style="text-align: right;" data-sheets-numberformat='{"1":2,"2":"#,##0.00x","3":1}'>- </td>
</tr>
<tr><td colspan="6" data-sheets-value='{"1":2,"2":"Source: KOFIA &amp; KRX"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>Source: KOFIA &amp; KRX</td></tr>
</tbody>
</table>

Short-selling to Kakao Bank is not decreasing. On the contrary, the trend is getting worse. The proportion of short trading in today's total trading volume again hit the 15% level. Today's short VWAP was ₩66,241.Today's closing price was $65,500, which is actually the lowest since listing. Even at this lowest price, short-selling was made quite aggressively.Today's shorting also has an important meaning in terms of share price trends. Except for September 10, when short selling was allowed, the days with the most short-selling were September 15 and September 16. However, this time, it was a short sale aimed at a price surge right after the share price rose by almost 8% on September 14.However, today, when the stock price has already fallen for three consecutive days, short-selling has reached the level of more than 15% of the trading volume. Rather than a shorting inflow due to a temporary share price rebound, today's should be seen as a short-selling betting on a structural downward trend in Kakao Bank's share price.The daily loan balance (new vs. repaid) below also has interesting implications. Yesterday (September 30), there was a significant level of repayment. There were loan repayments of over 1M, the highest level since short selling was allowed. Yesterday's closing price was ₩68,400, and yesterday's repayment can be interpreted as a partial liquidation of short positions betting on short-term stock price volatility after listing.However, it is worth noting that today's share price has been sufficiently corrected; still, new loans are close to 700K. So, the loan balance returned to close to 15M again. This can be another evidence suggesting a new influx of short-sellers aiming for a structural downturn in Kakao Bank's fundamentals instead of betting on short-term price volatility.










Date
Newly loaned shares
Loaned shares repaid
Loan balance
Short interest
Loan balance/Short interest


9. 10
3,150,200
546,907
6,940,058
1,330,825
5.21x


9. 13
2,626,620
216,381
9,350,297
1,621,216
5.77x


9. 14
2,605,990
453,409
11,502,878
2,344,735
4.91x


9. 15
1,164,047
68,003
12,598,922
2,912,744
4.33x


9. 16
1,231,797
156,382
13,674,337
3,326,154
4.11x


9. 17
609,292
263,228
14,020,401
3,363,456
4.17x


9. 23
262,003
599,445
13,682,959
3,375,519
4.05x


9. 24
1,513,289
256,602
14,939,646
3,229,657
4.63x


9. 27
1,165,155
617,393
15,487,408
3,282,877
4.72x


9. 28
151,094
318,789
15,319,713
3,317,155
4.62x


9. 29
256,811
309,072
15,267,452
3,455,668
4.42x



9. 30
568,014
1,178,857
14,656,609
-
- 


10. 1
655,302
463,995
14,847,916
-
- 

Source: KOFIA &amp; KRX



KakaoBank

Kakao Bank Short Trading Analysis