"Mr. Zhong, according to the current trend, the yen will definitely continue to rise..."
Andrew was greatly alarmed and quickly spoke to dissuade him. In his view, the yen futures would definitely rise strongly during this period, and the money in Zhong Shi's account would grow at an incredible rate.
Although this transaction would earn him at least a few tens of thousands of dollars in commission, who wouldn't want more money!
"Quickly calculate for me how much option premium is needed to establish a one billion dollar option position! Do as I say, immediately!"
Zhong Shi was completely unmoved, speaking in a cold tone. He was really a bit annoyed by the broker's擅自行动, and was even considering whether to switch to another brokerage firm.
In the future, it was not uncommon for brokerage firms to misappropriate client funds. In the early days of the Chinese securities market, a securities company established in Shenzhen and Hong Kong misappropriated 8 billion yuan of client reserves, causing huge losses. The government solemnly assured the creditors that the company would not go bankrupt and that the government would be responsible for all debts. However, they then declared the securities company bankrupt, leaving many people with nothing.
Although this futures company was American-funded and had better management and professional standards than domestic companies, who could guarantee that such moral risks would not occur?
Seeing Zhong Shi's expression change, Andrew immediately shut up and called his colleague in the United States.
"Zhong Shi, what's going on?"
Zhong Yi finally got a chance to speak. He had been sitting there for most of the night and had some understanding. However, he couldn't believe that his cousin's net worth had skyrocketed to such an astronomical figure in just a few days.
"Nothing, just made a little money in the futures market. Sigh... the money I have now is still too little..."
Zhong Shi said lightly. Those in the room who understood his words rolled their eyes, feeling disdain for Zhong Shi: "A net worth of forty million and still complaining about not having enough money? What kind of person is this!"
Liao Chengde rolled his eyes even more. He had known Zhong Shi the longest and was most familiar with his background. Zhong Shi had extorted one million Hong Kong dollars from Liao Chengde with a Ding kiln white porcelain bowl, then made a large profit from "Cheung Kong Holdings," and in a short time, his wealth had skyrocketed to the tens of millions, almost catching up to the wealth Liao Chengde had accumulated over half his life.
What Zhong Shi said about not having enough money was indeed true. For such a once-in-a-lifetime opportunity, it was absolutely essential not to miss it. If he invested all his current assets, he would only make a small profit, while the big sharks with billions of dollars would make the lion's share.
The reason he wanted to exit the futures market was, first, to avoid a counterattack by the yen's short sellers, as Japanese financial groups were still very powerful at this time; second, to avoid being forced to liquidate if the short sellers couldn't hold on, which would limit his profits.
After all, once the news of the dollar's devaluation was announced, it was unlikely that more funds would blindly enter the short side. In that case, it was better to switch to the options market early.
Options, also known as options, are a derivative product based on futures. They are the right to buy or sell a specific underlying asset at a predetermined price within a certain period in the future. The buyer pays a certain amount (the option premium) to the seller to have the right to buy or sell a certain quantity of the underlying asset at a predetermined price within a certain period, but is not obligated to do so.
For example, the ten billion dollar yen option that Zhong Shi mentioned would allow both parties to buy ten billion dollars worth of yen at an agreed price over a two-year period. When the agreement is reached, Zhong Shi would need to pay a certain amount of option premium to the seller and could choose to exercise or abandon the option before the expiration date.
Options are divided into American options and European options. American options can be exercised at any time during the period, while European options can only be exercised on a specific date. Due to the different time limits, the option premiums also differ.
"Sir, I found it. Currently, the main yen futures on the Chicago Mercantile Exchange are issued by Japanese Sumitomo Bank, Japanese Sakura Bank, and American Chase Bank. There are not many two-year options, and the agreed delivery price is... " At this point, Andrew paused, looking at Zhong Shi. Seeing that Zhong Shi's expression did not change, he continued, "The two-year yen option has risen sharply from 200 to 180 this morning, and the option premium has also increased significantly!"
"Oh, it seems the Japanese financial groups have reacted quickly. How much option can I buy with all my current assets?" Zhong Shi touched his smooth chin thoughtfully and asked.
"Sir, you can probably buy options with a total notional value of 200 million dollars!"
Andrew's voice lowered, sounding a bit embarrassed, as if he had done something wrong.
"200 million... 200 million..."
Zhong Shi nodded, his fingers tapping the table. As he tapped, everyone in the room fell silent, staring at Zhong Shi, waiting for his next instructions.
"Old Liao, how much money can you come up with now? Also, do you want to withdraw your five million or keep it in my portfolio to continue making money?"
After a long silence, Zhong Shi suddenly asked, addressing the wealthiest person in the room, Liao Chengde.
"30 million, I think. I'll take that part out first. I'm scared now and don't want to risk all my assets. Unlike you, I'm already half in the grave..."
Liao Chengde hesitated for a moment, then said with a bitter smile.
"30 million, plus a 20 million loan, making it 60 million in total. That should be enough. By next July, we'll have some liquid funds, so this works."
Zhong Shi nodded and instructed Andrew, "In that case, I'll keep my position for now. I think we'll make a lot more in the next few days, waiting for the Japanese financial groups to enter the market!"
After saying this, he called to the others and left leisurely. Lu Hu naturally followed, while Liao Chengde and Zhong Yi exchanged glances, shook their heads with a bitter smile, and hurriedly followed Zhong Shi after apologizing to the others in the room.
...
The next evening, Zhong Shi and Liao Chengde arrived at the trading room on time. This time, Zhong Shi didn't fall asleep immediately but kept a close eye on the numbers on the screen, calculating in his mind.
After returning home yesterday, Zhong Shi didn't say much, collapsing on the bed and falling asleep, leaving Liao Chengde and Zhong Yi puzzled. Hadn't he just woken up at the futures company?
It turned out that Zhong Shi's actions were not without purpose. Early in the morning, he woke up the drowsy Liao Chengde, telling him to liquidate his stocks and then to get a 20 million loan from HSBC. Just as Liao Chengde was secretly calculating, Zhong Shi's words dispelled his doubts.
"What's a few million now? I'll ensure you have a net worth of a hundred billion in the future!"
"A net worth of a hundred billion?!"
Liao Chengde's head heated up, and he immediately agreed. If it weren't for the events of the past few days, he wouldn't have believed Zhong Shi had such magic. Seeing Zhong Shi turn ten million into forty million in just a few trading days, the speed of making money left him in awe.
With 60 million in hand, Zhong Shi returned to the futures company, ready to make a big move.
"Sir, you're here?"
Andrew's face showed respect as he made a traditional welcoming gesture, which made the Zhong brothers and Liao Chengde smile. This foreigner had adapted to local customs quite quickly.
"Today, gradually liquidate the long positions and slowly accumulate options. Do you understand?"
Zhong Shi chuckled, his mood undoubtedly excellent as he thought about his plans for the next year.
"Yes, sir!"
Andrew bowed and made the three of them laugh.
Seeing that he understood, Zhong Shi yawned, and Andrew, noticing, had a blanket and pillow brought in for Zhong Shi to rest in the trading room. He didn't send Zhong Shi to the rest room because today's trading might have some variables, and in case of any emergencies, he could notify Zhong Shi immediately.
The development of events was surprisingly smooth. The long positions that Andrew liquidated were instantly swallowed up in the massive volume of trades, like a stone sinking into the sea, causing no ripples.
By 2:00 PM New York time, Zhong Shi had liquidated all his yen long positions. Thanks to the enthusiasm of the market, his account, which was 40 million Hong Kong dollars the previous day, had risen to over 65 million, with a return of 550%.
Just as Andrew had liquidated all the positions, a large amount of funds suddenly appeared on the Chicago Mercantile Exchange, and the yen short sellers gained strength, aggressively attacking the long side. The volume of trades skyrocketed, and the battle was on!
Zhong Shi, who had already exited, was woken up. He looked at the numbers flashing on the screen, patted his chest in relief, and turned to Andrew, "What's the status of the Japanese financial groups' options now?"
"Sir, what is the exchange rate for the options offered by the Japanese financial groups?"
Zhong Shi narrowed his eyes, a glint of insight appearing.
"The Japanese financial groups' quotes have risen, crossing the 190 mark, and the option premiums have dropped significantly. It seems the Japanese are very confident in their exchange rate!"
Andrew reported, understanding that the Japanese financial groups had entered the market in force, trying to curb the rapid appreciation of the yen due to the news from the previous day.
"Rash and reckless, buy with all our might! Establish a 500 million dollar position and show them the power of the Americans!"
Zhong Shi's expression turned serious as he gave the order.
His words shocked Andrew, but then a surge of enthusiasm filled Andrew's chest. Indeed, who in this world would dare to challenge the United States, even the mighty Japan?
Just before the market closed, Zhong Shi's desired position was finally established, costing him 80 million Hong Kong dollars. Including the money he had made from the futures market, Zhong Shi now owed Liao Chengde 20 million Hong Kong dollars.
"Don't pay back the 20 million to the bank for now; there's still two years left. Old Liao, what are your plans?"
Zhong Shi wiped the sweat from his forehead and asked Liao Chengde casually. (I hope everyone supports me, recommend and collect, thank you!)