What Worked Asia - 23 Jun 2017 - Overall Dividend Yield did well in Asia

What Worked

Nothing really stood out in both China and Hong Kong this week. However names up last week in China were hurt this week. IMAX China Holdings is down 13% and Tian Ge Interactive is down 8%. In Singapore, high Dividend yield names continued to do well this week. Fortune Real Estate Investment is up 5% and Asian Pay Television Trust is up 6%.

In South Korea there was a slight selloff in high Dividend Yield names and a move into Growth. High growth names that did well were Samsung Electro-Mechanics is up 12% and Samsung SDI is up 12%. In Taiwan, large-cap names did well this week. Eclat Textile is up 9% and Airtac International is up 9%. Indonesia  and Malaysia saw a good selloff in Value and a move into Size. In the Philippines it was the opposite with Value doing well and large-cap names getting hurt this week. Vivant corp is down 10% and Belle Corp is down 6%.

Who Moved

182 names moved on volume this week. The volume spikes look to be well distributed across the different regions and sectors. On the positive side, GreaterChina Professional Services is up 19%, Lai Sun Development is up 12% and Jaiprakash Associates is up 16%. On the other side, SillaJen is down 16%, KEPCO is down 15% and Sapura Energy is down 15%.

Summary

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What Worked Australia - 23 Jun 2017 - Value Punished & Profitability still strong

What Worked

Value, in all its forms that we cover, was sold off this week. Of the Value signals, PBR was hit the hardest. In what has been a solid month of outperformance for the most expensive names in the market on a PBR basis, it was the cheaper side of the market that underperformed this week. Amongst the cheapest names on a PBR basis that finished lower was Santos Limited (STO, -3.5%), Myer Holdings (MYR, -4.39%) and Aveo Group (AOG, -4.2%). High Dividend Yield names were also hit this week, amongst the highest in the market that finished lower was Cromwell Property (CMW, -2.4%), Harvey Norman Holdings (HVN, -4.4%) and Retail Food Group (RFG, -9.7%), only making them more attractive on a pure yield basis.

The profitability measures also returned strong numbers this week. While ROE was the clear outperformer on the back of a sell-off in PBR, ROIC has managed to continue along for another week in the positive. The big difference this week, however, was in the quintile performance. While last week saw low ROIC names being sold off, this week saw a surge into High ROIC names, while the low ROIC basket remained flat to the market. High ROIC names doing well this week include the names that managed market outperformance last week despite a flat result for High ROIC names. Bellamy’s Australia (BAL, +8.9%), a2 Milk (A2M, +5.4%) and St. Barbara (SBM, +4.2%).

Who Moved

Some good volumes this week, with almost 10% of the benchmark moving on significantly higher than normal volumes. On the positive side Navitas (NVT, +6.1%), Regis Resources (RRL, +5.2%) and Sydney Airport (SYD, +3.1%) all finished the week positive despite a down market. On the other side, QBE Insurance (QBE, -10.2%), Vicinity Centres (VCX, -5.7%) and Tassal Group (TGR, -5.3%) all finished lower on the back of strong volume.

Summary

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What Worked Japan - 23 Jun 2017 - Quality worked and really nothing else stood out

What Worked

Low Debt to Equity and high ROIC names did the best this week. Low Debt to Equity names that did well were Murata Manufacturing (6981) up 11%, Zeon Corp (4205) up 10% and Alps Electrics (6770) up 9%. Low Debt to Equity names have only done this well once in the last 2 years. High ROIC names that did well were Yamaha (7951) up 6%, Hitachi Chemical (4217) up 7% and OBIC (4684) is up 7%.

On the other side, there was a slight selloff in low PBR names. Low PBR names have not really done well since the middle of April. Low PBR names that were hurt were Nomura Real Estate Holdings (3231) down 13%, Hokuriku Electric Power (9505) down 5% and Nippon Yusen Kabushiki Kaisha (9101) down 4%. All other factors were pretty much insignificant.

Who Moved

Only 13 named moved on volume this week. On the positive side, Murata Manufacturing (6981) is up 11%, Taiyo Yuden (6976) is up 7% and Aiful Corp (8515) is up 5%. On the other side, there was only one name down on volume this week, Tsumura (4540) down 1%.

Summary

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What Worked Asia - 16 Jun 2017 - Value worked in Singapore and South Korea

What Worked

Names with high dividend yield dominated in Singapore this week. Hutchinson Port Holdings is up 9% and Ascendas India Trust is up 7%. South Korea was all about Value, particularly low PE, this week. Low PE names that did well were SK Gas up 7% and SKC up 8%. High Beta names also did well in South Korea this week. In China, there was a selloff in short-term momentum and large-cap names. Large-cap names that were hurt were China Evergrande Group down 16% and Want Want China Holdings down 9%.

In Hong Kong, nothing really stood out this week. India was the same with only a slight selloff in large-cap names. In the Philippines, momentum was hurt this week. This is the first-week momentum has not done well since the end of March. Atok-Big Wedge is down 8% and Rizal Commercial Banking is down 8%. Value also did very well in Taiwan this week. Low PBR names that were up were Casetek Holdings up 8% and Tatung Co up 8%.

Who Moved

172 names moved on volume this week. The volume spikes look to be relatively spread evenly across sectors. However, at the country level, South Korea picked up a good number of volume spikes. On the positive side, SillaJen Inc is up 48%, Igarashi Motors India is up 21% and GMR Infrastructure is up 16%. On the other side, Esprit Holdings is down 25%, Global Brands Group is down 22% and Xiabuxiabu Catering Management is down 17%.

Summary

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What Worked Australia - 16 Jun 2017 - Profitability rules this week

What Worked

Profitability metrics stood out this week, in large part driven by underperformance of Australia’s least profitable names. This week saw the strongest week for ROIC in 9 months, and it has been steadily climbing over the last 3 weeks. One thing to be wary of though is that seems to be about the limit for this factor, with some serious negative performance potential in the next couple of weeks. Low ROIC names doing poorly this week included Iluka Resources (ILU, -3.3%), Ardent Leisure Group (AAD, -0.9%) and Santos Limited (STO, -2.6%). High ROIC names also did well, although as a group was largely in line with the benchmark. High ROIC names that really outperformed included Bellamy’s Australia (BAL, +15.2%), a2 Milk (A2M, +2.8%) and St. Barbara (SBM, +3.1%).

There was also a reasonably strong reversal in the short term momentum names. This Rank IC number, however, is not reflected in the top and bottom quintiles and is in large part being driven by names in the middle 60% of the market. Short term momentum has been working as a positive signal for the best part of the last month, and has finally hit its snapping point and has flipped back to being a contrarian signal – names down over the last month that bounced hard this week include Sigma Healthcare (SIG, +3.6%), Sirtex Medical (SRX, +5.8%) and Mayne Pharma (MYX, +5.5%).

Who Moved

13 names in the benchmark index moved this week on significantly higher than normal volumes. For the most part, these moves were positive. On the downside, Galaxy Resources (GXY, -23.6%), Medibank Private (MPL, -2.5%) and BHP Billiton (BHP, -2.3%) all finished the week lower. On the positive side of things, Acconex (ACX, +10.8%), Mineral Resources (MIN, +8.4%) and Ansell Limited (ANN, +7.6%) all finished the week higher.

Summary

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What Worked Japan - 16 Jun 2017 - Beta and Long-term momentum names were hurt this week

What Worked

Long-term momentum and high Beta names were hurt this week. Long-term momentum names have not done this poorly since the end of March this year. Disco (6146) is down 10%, Furukawa Electric is down 10% and Toyo Tire & Rubber (5105) is down 9%.  High Beta names also did not do well this week. Beta has only worked 1 out of the last 6 weeks. High Beta names that outperformed this week were Maeda (1824) is up 8%, Toshiba (6502) is up 7% and Daiwa House Industry (1925) is up 6%.

To a lesser degree, growth names did not do well this week. Sumco (3436) is down 9%, Nippon Paint Holdings (4612) is down 8% and Tokyo Electron (8035) is down 7%.

Who Moved

Only 10 names moved on volume this week. On the positive side, Tsumura (4540) is up 11%, ONO Pharma (4528) is up 9% and Aiful (8515) is up 3%. On the other side, Mabuchi Motors (6592) is down 8%, Nippon Paint Holdings (4612) is down 8% and Softbank Group (9984) is down 4%

Summary

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What Worked Australia - 02 Jun 2017 - Earnings Revisions strong, Low Sales Growth working

What Worked

Not a lot of colour in the market this week, with the only factors showing any real movement was EPS Revisions. 1 Month EPS revisions had their strongest week so far this year, almost doubling the closest week in terms of Rank IC. Names with good EPS revisions over the last month that finished up for the week included James Hardie (JHX, +2.8%), Fischer & Paykel Healthcare (FPH, +4.0%) and Aristocrat Leisure (ALL, +3.0%), while names with earnings downgrades over the last month finished down. Among these were Ardent Leisure (AAD, -2.8%), Vocus Group (VOC, -6.1%) and Nanosonics (NAN, -2.5%).

Forward Sales growth positive negative results for the week, but largely on the back of names with poor sales growth outperforming the index, rather than high growth names underperforming. Low forecast Sales Growth names that did well this week included Alumina Limited (AWC, +3.5%), IOOF Holdings (IFL, +1.2%) and Cromwell Property Group (CMW, +2.3%).

Who Moved

18 Names managed to move this week on volume, with a good spread across the sectors, and for the most part finishing up. On the positive side, Sigma Pharma (SIG, +10.2%), Flexigroup (FXL, +8.1%) and Fischer & Paykel Healthcare (FPH, +4.0%) rounded out the best performers on volume, while Domino’s Pizza (DMP, -7.1%), Galaxy Resources (GXY, -4.5%) and Wesfarmers Limited (WES, -1.6%) all finished the week down.

Summary

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What Worked Japan - 02 Jun 2017 - High beta names bounced back as high dividend yield names continued to be hurt

What Worked

After 3 weeks of poor performance, names with high Beta to TOPIX and Beta to the Yen bounced back this week. H2O Retailing (8242) is up 9%, Dowa Holdings (5714) is up 10% and TADANO (6395) is also up 9%. There was a slight sell-off in names with high dividend yield. This is the 5th week in a row that high dividend yield names have not done well. However, with only 51 names down in TOPIX 500 this week it was more about which names did not go up as much. Park24 (4666) is down 6%, FamilyMart (8024) is down 4% and Oracle Corp Japan (4716) is down 4%.

Names with a high percent of Institutional Investors did better this week after doing poorly over the last month. Showa Denko (4004) is up 12% and Tokyo Ohka Kogyo (4186) is up 10%. Long-term momentum names were up while short-term momentum names were hurt this week. Mitsui Mining and Smelting (5706) is up 5% and MinebeaMitsumi (6479) is up7%.

Who Moved

Only 24 names moved on volume this week. On the positive side, Tosoh Corp (4042) is up 8%, Miraca Holdings (4544) is up 7% and Sysmex Corp (6869) is up 6%. On the other side, Oracle Corp (4716) is down 4%, Fuji Media Holdings (4676) is down 2% and Otsuka (4768) is down 1%. All on strong volume.

Summary

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What Worked Japan - 19 May 2017 - Value and Beta hurt for the second week in a row

What Worked

Value and high Beta names were hurt for the second week in a row. High Beta and low PBR names did poorly this week and the last after 1 month of outperformance. Before that both factors underperformed for 5 weeks straight. Low PBR names that were hurt were Idemitsu Kosan (5019) down 11%, Japan Petroleum Exploration down 10% and Central Glass (4044) down 10%.

High Beta names that went down were NTN Corp (6472) down 14%, Mitsubishi UFJ Lease & Finance (8593) down 9% and NSK (6471) down 9%. Names with a high ROE and to a lesser degree names with a high percent of Retail Investors benefited from the selloff in Value. Leopalace21 (8848) is up 9%, Toyo Tire & Rubber is up 9% and Toda Corp (1860) is up 7%.

Who Moved

101 names moved on volume this week. All the volume spikes look to be spread relatively evenly across all sectors. On the positive side, Nomura Real Estate (3231) is up 20%, Miura (6005) is up 10% and Shiseido (4911) is up 9%. On the other side, including the names mentioned above Isuzu Motors (7202) is down 11%, Japan Steel Works (5631) is down 10% and Hitachi Zosen (7004) is also down 9%.

Summary

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What Worked Asia - 12 May 2017 - Good move into Large-cap names in most of the region

What Worked

China and Hong Kong both saw a good move into large-cap names this week. In China, Datang International Power Generatation is up 16% and Zhou Hei Ya International is up 13%. In Hong Kong, China Minsheng Financial is up 20% and SEA Holdings is up 10%. No other factors really stood out in both markets.

In Thailand there was a good selloff in Value and high Beta names and a move into Large cap. Thai Retail Investment is up 7% and Srisawad Power is up 7%. Low PE names and to a lesser degree large-cap names did well in Singapore this week. Wilmar International is up 10% and First Resources is up 6%. In Taiwan, names up over the last 3 months continued to go up this week. General Interface Solution is up 17% and GlobalWafers is up 15%

Who Moved

148 names moved on volume this week. Almost half of the volume spikes came in India and Taiwan. At the Sector level, the Financial and Producer Manufacturing sectors pick up a good number of volume spikes. On the positive side, China Touyun Tech Group is up 21%, Hanmi Pharma is up 20% and Emerson Pacific is up 14%. On the other side, Taokaenoi Food & Marketing is down 15%, Ginko International is down 11% and Universal Robina is down 11%.

Summary

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