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

Korea Share Class Pair Trade: Assessing 3 Large Cap Prefs Below -1σ

LG Chem Pref Arb Trade: Capitalize on a Disparity Resulting from Index Rebalancing

Samsung SDI Ord's Price Gain on a Market Noise Last Friday: Two Pair Trades Worth Considering

LG Chem Pref Has Harshly Diverged as the Discount Is at a New 2-Yr High

LG Chem Dividend Situation: 1P/C Trade, Div Play, & Hybrid of Combining Two

Tesla Rally Pushed LG Chem 1P Diversion to an Extreme: Trade σ Reversion & 1P Div

Event-Driven

<p>LG Chem's minimum yr-end dividend is ₩10,000 for ord. That is, we have ₩10,500 for 1P, which delivers a 2.64% div yield.</p><ul><li>December 29, Tuesday, is the ex-rights.</li></ul><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td data-sheets-value='{"1":2,"2":"Yield"}'>Yield</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2017}'>2017</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2018}'>2018</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2019}'>2019</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"2020E"}' data-sheets-numberformat='[null,2,"#,##0",1]'>2020E</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Common - DPS"}'>Common - DPS</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]'>₩6,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]'>₩6,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]'>₩2,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":10000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]'>₩10,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Price"}'>- Price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":405000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula='=index(googlefinance(Table!R5C2, "price", date(2017,12,27)), 2,2)'>₩405,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":347000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula='=index(googlefinance(Table!R5C2, "price", date(2018,12,27)), 2,2)'>₩347,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":317500}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula='=index(googlefinance(Table!R5C2, "price", date(2019,12,29)), 2,2)'>₩317,500</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":800000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula="=R[20]C[-3]">₩800,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Common - dividend yield"}'>Common - dividend yield</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.014814814814814815}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">1.48%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.01729106628242075}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">1.73%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.006299212598425197}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">0.63%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.0125}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">1.25%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1P - DPS"}'>1P - DPS</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6050}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula="=R[-3]C[0]+(Table!R26C2*0.01)">₩6,050</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6050}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula="=R[-3]C[0]+(Table!R26C2*0.01)">₩6,050</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":2050}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula="=R[-3]C[0]+(Table!R26C2*0.01)">₩2,050</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":10050}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula="=R[-3]C[0]+(Table!R26C2*0.01)">₩10,050</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Price"}'>- Price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":249000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula='=index(googlefinance(Table!R9C2, "price", date(2017,12,27)), 2,2)'>₩249,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":195500}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula='=index(googlefinance(Table!R9C2, "price", date(2018,12,27)), 2,2)'>₩195,500</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":173000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula='=index(googlefinance(Table!R9C2, "price", date(2019,12,29)), 2,2)'>₩173,000</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":377000}' data-sheets-numberformat='[null,2,"[$₩-412]#,##0",1]' data-sheets-formula="=R[19]C[-3]">₩377,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1P - dividend yield"}'>1P - dividend yield</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.024297188755020082}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">2.43%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.030946291560102302}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">3.09%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.011849710982658959}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">1.18%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.026657824933687003}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=R[-2]C[0]/R[-1]C[0]">2.67%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Difference"}'>- Difference</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"0.94%p"}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula='=left(((R[-1]C[0]-R[-4]C[0])*100), 4)&amp;"%"&amp;"p"'>0.94%p</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"1.36%p"}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula='=left(((R[-1]C[0]-R[-4]C[0])*100), 4)&amp;"%"&amp;"p"'>1.36%p</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"0.55%p"}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula='=left(((R[-1]C[0]-R[-4]C[0])*100), 4)&amp;"%"&amp;"p"'>0.55%p</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"1.41%p"}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula='=left(((R[-1]C[0]-R[-4]C[0])*100), 4)&amp;"%"&amp;"p"'>1.41%p</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Difference/1P div yield"}' data-sheets-numberformat='[null,2,"#,##0",1]'>- Difference/1P div yield</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.39026629935720847}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[-2]C[0]-R[-5]C[0])/R[-2]C[0]">39.03%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.44125562674161045}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[-2]C[0]-R[-5]C[0])/R[-2]C[0]">44.13%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.46840791242558094}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[-2]C[0]-R[-5]C[0])/R[-2]C[0]">46.84%</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.5310945273631841}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=(R[-2]C[0]-R[-5]C[0])/R[-2]C[0]">53.11%</td>
</tr>
<tr><td colspan="5" rowspan="1" data-sheets-value='{"1":2,"2":"Source: SEIBro &amp; FnGuide"}' data-sheets-numberformat='[null,2,"#,##0",1]'>Source: SEIBro &amp; FnGuide</td></tr>
</tbody>
</table><table class="table table-striped">
<colgroup>
<col width="300">
<col width="300">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Dividend condition (₩B)"}'>Dividend condition (₩B)</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Type"}'>Type</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Cash"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>Cash</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Frequency"}'>Frequency</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Annually"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>Annually</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Record date"}'>Record date</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"December 30"}'>December 30</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Ex-rights"}'>- Ex-rights</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"December 29 (Tuesday)"}'>December 29 (Tuesday)</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table>

LG Chem's minimum yr-end dividend is ₩10,000 for ord. That is, we have ₩10,500 for 1P, which delivers a 2.64% div yield.December 29, Tuesday, is the ex-rights.









Yield
2017
2018
2019
2020E


Common - DPS
₩6,000
₩6,000
₩2,000
₩10,000


- Price
₩405,000
₩347,000
₩317,500
₩800,000


Common - dividend yield
1.48%
1.73%
0.63%
1.25%


1P - DPS
₩6,050
₩6,050
₩2,050
₩10,050


- Price
₩249,000
₩195,500
₩173,000
₩377,000


1P - dividend yield
2.43%
3.09%
1.18%
2.67%


- Difference
0.94%p
1.36%p
0.55%p
1.41%p


- Difference/1P div yield
39.03%
44.13%
46.84%
53.11%

Source: SEIBro &amp; FnGuide







Dividend condition (₩B)

Type
Cash


Frequency
Annually


Record date
December 30


- Ex-rights
December 29 (Tuesday)

Source: DART



LG Chem

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