Posts

Mean Reversion Trading Deep Dive: From Galton 1886 to Pairs Trading

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I want to write about mean reversion the way I wish someone had written about it for me. Not the textbook version, where it’s introduced as a single idea and then dropped. The actual lineage. Where it came from, why it works when it works, and the very specific moments where it stops working and traders lose money in surprising ways. This is going to be a longer read than most blog posts. The reason is that mean reversion is one of the foundational ideas in quantitative trading, and most online explanations of it are bad. They either reduce it to “buy low, sell high” (which isn’t what mean reversion means) or they go straight to indicators without explaining what the indicators are measuring. I’d rather give you the full picture. For Korean market readers specifically, this matters because Korean equities exhibit some of the cleaner mean-reversion behavior in developed markets, partly because of structural retail flow and partly because the KOSPI 200 universe is small enough that sta...
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The K-Shipbuilding Super Cycle: LNG, Methanol, and Why Korean Yards Keep Winning

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For most of the 2010s, Korean shipbuilders were a story you only paid attention to if you were short. Order books were thin, Chinese yards were eating market share, and the big three Korean names traded like cyclical scrap. Then something shifted, and by the early 2020s the picture had inverted. LNG carrier orders, methanol-fueled containerships, and a structural shortage of yards capable of building complex high-value vessels combined into what people now call the K-shipbuilding super cycle. This post walks through what actually happened, why Korean yards specifically are the ones winning the cycle, and what foreign investors should look at if they want exposure. I’ll cover the four major listed names (HD Korea Shipbuilding, HD Hyundai Heavy, Samsung Heavy, Hanwha Ocean), the fuel transition that’s driving order flow, and the MASGA alliance with the United States that’s quietly shaping the next decade. All financial figures referenced are as of the June 9, 2026 KRX market close, and ...
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KOSPI vs KOSPI200 vs KRX300: Which Korean Index Should You Actually Track?

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When I first started looking at Korean equities through a foreign investor lens, the index naming caught me off guard. There are at least three Korean stock indices people throw around without explaining them: KOSPI, KOSPI200, and KRX300. They’re related but not interchangeable, and picking the wrong one can mean tracking a completely different slice of the market than you thought. This post walks through what each index actually represents, why they exist, and which one matters most for foreign investors who want clean Korea exposure. I’ll also cover the ETF options that track each, both in Korea and on US exchanges. A quick disclaimer up front: I’m not a licensed advisor, and what follows is just my own working framework after spending time with these indices. Anything actionable should be checked against your own research and probably a real advisor too. So what is KOSPI, actually? KOSPI stands for the Korea Composite Stock Price Index. It launched on January 4, 1980, with a ba...
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Korea Value-Up Program Explained — Buybacks, PBR, 2026 Law

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In my last post on the Korea Discount , I ended with a promise: I’d dig into what changed in 2024. This is that post. The short version is that in February 2024, Korea’s Financial Services Commission rolled out something it called the Corporate Value-Up Program . Two years later, with a major Commercial Code amendment now passed and the first wave of low-PBR stocks already rerated, it’s a good moment to look at what actually happened, what’s working, and what isn’t. I’m going to try to be honest about both sides. A lot of the early reporting on Value-Up was either too excited (the cynics call it “K-Value-Up hopium”) or too dismissive (“voluntary disclosure won’t fix structural problems”). The truth, as usual, sits somewhere in between. What the Value-Up Program actually is At its core, the Value-Up Program is a policy framework that asks Korean listed companies to do three things voluntarily: Publish a corporate value-up plan that includes return-on-equity targets and shareholder...
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Why Are Korean Stocks Cheaper? Understanding the Korea Discount

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If you’ve ever pulled up a chart of KOSPI and wondered why it trades at half the multiples of the S&P 500, you’re not the first. Foreign investors have been asking that question for years. Korean academics have written hundreds of papers about it. And in 2024, the Korean government finally decided to do something about it. The phenomenon has a name: the Korea Discount . Korean stocks, on average, trade at lower price-to-book and price-to-earnings ratios than their developed-market peers, even when their underlying businesses look healthy. For global investors, it’s a real and persistent puzzle worth unpacking. I want to walk through what I think is the most useful way to understand it: where it comes from, what changed in 2024, and what to actually watch from here. So what exactly is the Korea Discount? The simplest definition is this: Korean listed companies, as a group, trade at lower valuation multiples than companies of similar size and quality in the United States, Europe,...
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