Benefiting from the Nikkei Index's continuous rise over six weeks and the strong psychological expectation of approaching 40,000 points as the year-end approached, the market was filled with a very optimistic mood. Funds flowed into the bulls like a flood. In this situation, the bears could only open opposing orders at a very high price, even reaching as high as 39,500 points, directly approaching the psychological barrier of 40,000 points.
Even so, once the short orders were thrown out, they were immediately picked up by the bulls. Everyone knew that most of the long positions in the market had been taken over by Japanese funds. Now, only some leftovers remained, and if they didn't act quickly, they might lose even that.
However, the sudden appearance of so many short positions in the market immediately cooled the feverish market sentiment. Analysts began to offer various explanations, one after another.
The most plausible explanation was that the annual review of Japanese financial groups was approaching, so Japanese funds in Singapore might withdraw on a large scale. They would re-enter the market on a large scale only after their internal adjustments were settled.
"Is the large-scale withdrawal of Japanese funds due to this reason?" In the operation room in Japan, Jim was gathering all the traders for an intense discussion about the recent anomalies in the market.
"Very likely!"
"Given the sudden appearance of so many long positions being sold, it will definitely impact the Japanese market. Is this the time for us to build a large position?"
The traders were very excited. They had battled with Japanese funds many times, with more losses than wins, not because of insufficient funds, but because the bullish performance of the Japanese market indirectly affected the Singapore index, leaving them helpless.
The frustrated traders were now waiting for an opportunity, a chance to turn the tide. Now, that opportunity had come.
There were two ways to clear long positions: one was for new bulls to take over, known as "long switch," and the other was to take over the short positions, known as "long close." Now, with hundreds of thousands of long positions being sold, there was simply not enough capital to take them over in a market where everyone was bullish.
Now, only Jim's team could take them over.
"But, if we suppress the Nikkei Index now, what about our bonuses?" A voice suddenly broke through the heated discussion, reminding everyone of their small treasury.
"Hey, Roger, have you forgotten? Our focus is on that massive amount of capital, not our money. Do you understand? Besides, if we can make money here, it will be far more than those small amounts." Matt sneered, his face showing disdain.
Indeed, just a one percent movement in the massive amount of capital they managed, amplified by leverage, could earn or lose more than the misappropriated funds.
The operation room erupted in laughter. Roger's face turned red and then white, clearly not having considered this. He had been so focused on his bonus that he had completely overlooked the purpose of the operation.
Many shared his thoughts, and Jim felt the need to remind them. He cleared his throat and said, "Gentlemen, our goal this time is to thoroughly suppress the Nikkei Index during Christmas and the following few trading days. Although I don't know what they have up their sleeves, for now, our opportunity has come. And as long as we achieve our specific goals, we can watch the subsequent chain reactions."
Everyone understood. They were merely the vanguard, or in less polite terms, cannon fodder. But they didn't mind; the amount of capital they could operate this time far exceeded their expectations.
A trader's ability is measured by two points: one is their sustained profitability, and the other is the scale of capital they can manage. An excellent trader (fund manager) who can manage tens of billions of dollars and maintain long-term profitability is a legend in the industry.
"Alright, gentlemen, now that everyone understands their tasks, let's go all out!" Jim tapped the table, his face showing a fierce expression, using this to boost everyone's morale.
"Yes, sir!" The traders responded loudly, then stood up and left their seats, each one like they had been injected with adrenaline, starting to aggressively sell in the Nikkei futures market.
"What? Someone is starting to take over the long positions?" When the long close information appeared on the trading screens, everyone was shocked.
When a massive amount of long positions was thrown into the market, many wondered how long this situation would last and whether anyone would take them over. But in just a few hours, dozens of thousands of hands of transactions appeared on the screen, instantly consuming a small portion of the long positions.
Moreover, this momentum did not stop. Larger and lower-priced short positions also emerged, even reducing the price to 39,400, clearly aiming to beat the bulls while they were down.
Now, it was up to the long positions to decide how to operate.
At the current price, the profit of the long positions would be squeezed into a limited range.
To everyone's surprise, the long positions accepted this price and quickly traded, closing out another portion of the long positions.
Everyone understood that this capital was determined to exit at any cost. Those who wanted to enter and those who wanted to exit became active. Those who wanted to go long began to take over the long positions, and those who wanted to close out their positions also wanted to buy long positions to offset their short positions.
The trading volume instantly increased, which naturally brought some difficulty to Jim's team. However, they had the advantage and sufficient capital, and by the end of the week, they successfully took over more than 40% of the long positions from the Japanese financial groups.
The long positions from the Japanese financial groups were so numerous that it took three trading days for the market to fully digest them.
This was partly due to the large amount of capital, but more so because Jim and his team frequently sold small amounts of short positions at very low prices to suppress the Japanese market.
These prices not only traded quickly without touching the massive long positions but also forced the long positions to lower their prices step by step.
In this situation, to trade quickly, the long positions had to repeatedly lower their prices. Due to the large volume, each price reduction caused market fluctuations.
The Nikkei Index gradually declined, reaching 39,300.
Jim felt the time was right and threw out a short position of over 15,000 hands at 39,000, as if telling the bulls that this was the bottom price.
The average build-up price of the bulls was around 38,500. Even at 39,000, they still made a good profit. However, seeing the bears gradually squeeze their profits, anyone would feel very frustrated.
Kumiko Iwamoto also cooperated, finally closing all his positions at 38,900, indirectly hurting other Japanese investors.
Influenced by them, the Singapore market opened low and closed low for the entire week, pulling down a downward trend line.
On the last trading day of the week, Jim and his team established a short position of 200,000 hands with an average price of 39,100, costing about 2.6 billion dollars. The other part of the long positions from the Japanese financial groups was taken over by other investors in the market. The entire market had about one million hands of contracts in different directions, and Jim's team accounted for a full 20%.
Influenced by the large-scale exit of the bulls, the confidence of the bulls was severely hit, and the index in the Singapore market plummeted, once breaking through 39,000 points. However, at the close, the bulls counterattacked and barely held the 39,000 point level.
Influenced by the Nikkei futures, the Nikkei Index, which had risen for six consecutive weeks, unexpectedly did not rise this week but fell by 230 points. In the week before Christmas, Jim achieved his expected goal, earning about 10 million dollars in profit.
Before the weekend, Jim received a call from the United States. The person on the other end was very satisfied with his performance and praised him for the first time, making Jim very happy. However, when he asked about subsequent operations, the person on the phone dismissed him with a simple "continue to be bearish."
The streets were already filled with the sound of "Jingle Bells," and occasionally, people dressed as Santa Claus could be seen handing out candy, creating a festive Christmas atmosphere.
The Japanese market does not close for Christmas, but in Singapore, Christmas is a public holiday. Therefore, Jim and his team had a three-day break.
For Westerners, Christmas is one of the most important holidays of the year. These traders, after finishing their work for the week, eagerly boarded trains to Tokyo and then flew to the United States and Europe, returning after Christmas.
Only Jim, Maxim, Matt, and a few others with ulterior motives stayed behind.
"Jim, is there any problem with our money?" Matt, who was still in the operation room, glanced at Maxim, who was pretending to be busy, and asked in a low voice.
"No problem, it's consistent with our capital operations, and we've made about one million dollars." Jim's face showed a proud expression. However, he also forgot to have the broker sell all these short positions, as he believed the Nikkei would continue to fall the following week.
"A large sum, isn't it?" Matt put on his coat, whistled proudly, and said, "Hey, guys, I'm off. Merry Christmas!"
"Merry Christmas!" Maxim, still tapping away at the screen, replied casually.
"Jim, how much did we actually make?" After Matt left, Maxim walked over to Jim, his face showing uncontrollable curiosity.
"We lost about 1.2 million dollars. I'm thinking about whether to sell everything on Monday." Jim's face was gloomy, and he seemed distracted.
"Don't think about it. Sell everything when it reaches 50 million. This way, you can still control your capital and give the investors an explanation. Consider the other 100 million as evaporated!" Maxim's face also showed a gloomy expression. He knew Jim wasn't lying because he had access to the relevant account information.
"It seems we need a foolproof plan to completely cover up this money, so we can silence these people and pass the upper-level inspection."
Most of Jim's capital was invested in the Singapore futures market through foreign brokers, with a portion as margin. The remaining approximately 1 billion dollars was left in the Japanese market for risk hedging.
This part of the capital in Japan could be easily covered up with some adjustments in the trading records. Everyone in his team was bound to this, and no one would speak out, as no financial institution would hire such people.
"Have you thought about how to spend Christmas?"
"Going to Kabukicho again? This time, it's your treat!"
"Deal!"
Jim and Maxim smiled at each other, both understanding each other's thoughts. It was time to release the long-suppressed desires. (An additional chapter is added today to thank for the recommendation votes exceeding 4,000. During the book's revision, the update pace will temporarily slow down, and only one update will be made on weekends. The author apologizes and hopes for your understanding.)