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

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

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

Equity Capital Markets

SK Innovation Co., Ltd. refines, markets, and distributes oil.  The Company produces a variety of petroleum products, such as gasoline, kerosene, liquefied petroleumgas (LPG), and diesel oil.  SK Energy also manufactures petrochemical p roducts, including paraxylene, synthetic resins, styrene monomer, and ethylene.

<ul>
<li>KRX’s move on SK Enmove this morning ramps up the odds of an SKI rights issue.</li>
<li>Timing’s again the key — unlike POSCO Future M, this isn’t a clean setup. Word is SK may wait for H2 rate cuts and a more risk-on market backdrop.</li>
<li>So, doesn’t look near-term — likely post-June once local tape firms up. Watch quirky local hot money flows that front-run moves like this.</li>
</ul>


KRX’s move on SK Enmove this morning ramps up the odds of an SKI rights issue.
Timing’s again the key — unlike POSCO Future M, this isn’t a clean setup. Word is SK may wait for H2 rate cuts and a more risk-on market backdrop.
So, doesn’t look near-term — likely post-June once local tape firms up. Watch quirky local hot money flows that front-run moves like this.


Explaining the Whole SK Enmove IPO Delay Situation This Morning: SK Innovation Rights Issue Likely

Index Rebalance

Samsung Biologics Co.,Ltd. manufactures bio-healthcare products. The Company develops, refines, and distributes biopharmaceutical products.

<ul>
<li>Korea's battery sector got wrecked, crushing POSCO and Samsung SDI's caps. Shakeup incoming: Hanwha Aerospace locks in, and Samsung Biologics is also a strong contender.</li>
<li>Low pre-positioning leads to highly correlated moves on rebalance day; last June, KB and Shinhan got in while LG Chem and Energy got cut with similar impact, netting ~3% yield.</li>
<li>Given the track record, it makes sense to trim the holding window on rebalance day and deploy a long-short strategy.</li>
</ul>


Korea's battery sector got wrecked, crushing POSCO and Samsung SDI's caps. Shakeup incoming: Hanwha Aerospace locks in, and Samsung Biologics is also a strong contender.
Low pre-positioning leads to highly correlated moves on rebalance day; last June, KB and Shinhan got in while LG Chem and Energy got cut with similar impact, netting ~3% yield.
Given the track record, it makes sense to trim the holding window on rebalance day and deploy a long-short strategy.


4 Key Movers in TIGER Top 10 in June Reshuffle

Event-Driven

Iljin Hysolus Co Ltd operates environmental problem solving businesses. The Company provides hydrogen solutions, CNG solutions, diesel solutions and other services. Iljin Hysolus conducts businesses in South Korea.

<ul>
<li>Short selling returns March 31, after 85% of the KOSPI 200’s rebalancing. Stocks set for removal will be prime short targets.</li>
<li>Stocks removed have solid liquidity, tight passive impact gaps between them, and with short selling restarting March 31, we could see intensified volume in the short basket.</li>
<li>With rebalance ahead, price action may start early. Market exposure means aggressive moves could happen before the end of March, so consider building futures positions before short selling resumes.</li>
</ul>


Short selling returns March 31, after 85% of the KOSPI 200’s rebalancing. Stocks set for removal will be prime short targets.
Stocks removed have solid liquidity, tight passive impact gaps between them, and with short selling restarting March 31, we could see intensified volume in the short basket.
With rebalance ahead, price action may start early. Market exposure means aggressive moves could happen before the end of March, so consider building futures positions before short selling resumes.


Play the Timing Sweet Spot Between KOSPI 200 Rebal and Short Selling Coming Back into Play

<ul>
<li>The FSS is banning arb trades under the MM book, requiring separate books for any arb positions to keep them distinct from MM flow.</li>
<li>Most local shops lack the resources to set up a separate arb desk. Splitting teams, creating new workflows, and hiring extra staff isn’t feasible given their tight P&amp;L.</li>
<li>Building a tracker for MM dropouts could spot dislocations, as the crackdown creates short-term inefficiencies—if we’re dialed in, there’s alpha to be made.</li>
</ul>


The FSS is banning arb trades under the MM book, requiring separate books for any arb positions to keep them distinct from MM flow.
Most local shops lack the resources to set up a separate arb desk. Splitting teams, creating new workflows, and hiring extra staff isn’t feasible given their tight P&amp;L.
Building a tracker for MM dropouts could spot dislocations, as the crackdown creates short-term inefficiencies—if we’re dialed in, there’s alpha to be made.


FSS Bans Arb in Local MM Books: Identifying Opportunities from Short-Term Inefficiencies

Posco Future M Co., Ltd. manufactures and distributes energy materials. The Company produces battery materials, advanced chemical materials, basic industrial materials, and other related products. Posco Future M also produces lime chemical and refractory products.

<ul>
<li>All three local CRAs are pushing hard — an equity raise isn’t optional, it’s the only shot at keeping the AA- rating intact. Street says it’s not if, it’s when.</li>
<li>Late April to mid-May looks like the key window. And start keeping tabs on the flow real tight.</li>
<li>Leak channels are still active. FSC’s pointed at IB sales and law firm staff. If we see outsized sell prints—especially from local hedge funds, that's our cue to act.</li>
</ul>


All three local CRAs are pushing hard — an equity raise isn’t optional, it’s the only shot at keeping the AA- rating intact. Street says it’s not if, it’s when.
Late April to mid-May looks like the key window. And start keeping tabs on the flow real tight.
Leak channels are still active. FSC’s pointed at IB sales and law firm staff. If we see outsized sell prints—especially from local hedge funds, that's our cue to act.


Timing the Announcement of POSCO Future M's Rights Issue

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

Sanghyun Park
Korea / Special Sits, Pairs, Index Rebalancing
• Clepsydra Capital

Explaining the Whole SK Enmove IPO Delay Situation This Morning: SK Innovation Rights Issue Likely

This post explains the whole SK Enmove IPO delay situation (by KRX) this morning and why it raises the chances of an SK Innovation rights issue.

Sanghyun Park

4 Key Movers in TIGER Top 10 in June Reshuffle

This post breaks down June’s key passive event in the Korean market: the TIGER Top 10 rebalancing, with four heavy hitters in play.

Sanghyun Park

Play the Timing Sweet Spot Between KOSPI 200 Rebal and Short Selling Coming Back into Play

The KOSPI 200 June rebalance screening is almost done. The adds and deletes are mostly as expected from my Jan screen, with the same names likely...

Sanghyun Park

FSS Bans Arb in Local MM Books: Identifying Opportunities from Short-Term Inefficiencies

This post covers the FSS's ban on arb trading in local brokerages' market making books, highlighting the potential opportunities that may arise...

Sanghyun Park

Timing the Announcement of POSCO Future M's Rights Issue

This post covers how to time the drop on POSCO Future M’s rights issue. This post dives into the best windows to watch, key indicators to track,...

Sanghyun Park