My Age of Investment

After leaving Xia Jingxing's office, Liu Hai came back not long after, holding a document in his hand.

"Look at it, the loss is not small."

Liu Hai handed the document in his hand to Xia Jingxing with an unsightly expression.

After receiving the document, Xia Jingxing was still stung by the numbers in the report, although he was mentally prepared.

Hundreds, hundreds, millions... billions!

A single interest rate cut by the Federal Reserve caused a loss of more than $500 million to Envision Capital's $14 billion net short position.

Taking Wells Fargo as an example, Envision Capital short-sold 32 million shares at an average price of $28.21. Today’s stock price surged more than 10%, touching $30. This not only erased the hundreds of millions of dollars in profits brought about by the stock’s continuous decline in the past few days. , and also caused a floating loss of more than 60 million US dollars to Envision Capital.

Other banking stocks also generally rose by more than 10%, and investment banking stocks rose by a smaller amount, at 4% or 5%.

If financial stocks hadn't generally fallen a few points some time ago, today's rebound alone would have caused a 10-digit loss for Vision Capital.

A loss of more than US$500 million seems exaggerated, but divided by the amount of funds of US$14 billion, the loss is only three or four points.

Where is this? To do finance, you first need a big heart.

Looking at Liu Hai, who looked a little solemn, Xia Jingxing said with relief: "Bernanke can only do three things, besides cutting interest rates!

If bank deposit interest rates are lowered, investors will withdraw money from bank deposits, and market liquidity will increase, effectively preventing inflation and slowing down economic recession.

But the United States is now in a critical condition, and even the thousand-year-old ginseng cannot save it, it will just shine again!

As long as we hold firm, the final victory will definitely belong to us. "

Liu Hai nodded, "I understand, but I feel a little sad. I couldn't make hundreds of millions of dollars in the past despite all my efforts, but now I can lose it in a day."

Xia Jingxing laughed loudly, "This just shows that we have become stronger! If we lose more, we will naturally earn more."

Liu Hai said: "Goldman Sachs and Morgan Stanley required us to increase margin, and I have already paid US$1 billion."

Xia Jingxing nodded lightly. Excluding the two foreign exchange funds managed by Jiang Ping and the fund of funds managed by Abel, Vision Capital had prepared a total of US$29 billion for the second wave of short selling.

Currently, only US$20 billion has been used, leveraging US$60 billion in leverage funds provided by Morgan Stanley and Goldman Sachs.

They also have US$9 billion in reserve in order to cope with the rebound of the US stock market and other emergencies.

After all, they were following a wretched tactic, and their trump cards must be buried deep.

Liu Haixian glanced at Xia Jingxing, "I predict that the U.S. stock market may fluctuate widely for a while, otherwise...do you have more funds on hand?"

Xia Jingxing shook his head, "Keeping too much cash on hand will greatly affect the rate of return, but you are right, we should make the ballast stone heavier.

I will contact major banks as soon as possible to make another equity pledge loan.

It may not come in handy, so be prepared!

If it is not used in the end, you will only lose some interest. "

Although Liu Hai felt that Xia Jingxing was a bit desperate, he did not object. As the saying goes: A lion fights a rabbit with all his strength!

What's more, Vision Capital has invested tens of billions of dollars this time, and it is already burning the boat. Naturally, it must use all available resources.

“It’s best not to use these loans unless absolutely necessary.”

Liu Hai said solemnly: "Facebook, YouTube, Ali, Tesla, Android, Overseas Holdings, and Renaissance Industries are all companies with great potential, and they are also your biggest trump card."

Xia Jingxing smiled. He understood what Liu Hai meant. The worst case scenario would be that Vision Capital would be destroyed, but his personal assets would not be destroyed and he could rely on the equity of these startups to make a comeback.

Liu Hai didn't say it very bluntly, also considering that these words were somewhat unlucky.

However, before you seek victory, seek defeat first. This is the wise saying left by our ancestors, and it is worth remembering!

"Don't worry! I will avoid all risks."

Seeing that Xia Jingxing was not complacent, but kept a clear head, Liu Hai put his mind at ease.

To put it bluntly, he and Xia Jingxing were now beyond ordinary friendship and were life and death friends.

If Xia Jingxing hadn't brought him into a whole new world, he might still be walking around Chinatown, recommending securities accounts to aunts and uncles.

He was very grateful to Xia Jingxing in his heart, and naturally he didn't want to see the other party lose everything because they were reluctant to stop their losses.

Without mentioning these heavy topics again, Liu Hai talked about some good news: "Although the rebound of the US stock market caused us a lot of floating losses by shorting the underlying stocks, this is still an opportunity.

At least for our option contracts, we should be able to take this opportunity to negotiate a better execution price and lower option premium.

When shorting the underlying stock, you can also wait for opportunities to make some adjustments, look for opportunities to close the position and then short at a higher position.

Judging from the Fed's intention, it seems that it has not given up treatment yet, and there will be more to do in the future. "

Xia Jingxing thought for a moment and felt that what Liu Hai said made sense. Before Lehman went bankrupt, the Federal Reserve had been actively rescuing the market.

If short sellers want to usher in a big carnival, they still have to go through some tug-of-war.

And because it is not a unilateral market, there will not be a spectacular drop of three thousand feet. Therefore, if you want to reduce costs and losses or even make a small profit during this period, you have to do some short-term operations.

"You and your team can figure it out. While the general direction of short selling remains unchanged, accumulate small wins into big wins. This can also reduce our margin pressure."

Liu Hai smiled. That's what he meant. Vision Capital is not an ordinary investor. It has a complete investment research team and can maximize profits through detailed operations within the defined general framework.

While the two were chatting, Jiang Ping knocked on the door and walked in. He also held a document in his hand.

After entering the room, Jiang Ping handed the document in his hand to Xia Jingxing, "The three major stock indexes including the S\u0026P, Nasdaq, and Dow have rebounded across the board, and a lot of profits have been taken away."

Xia Jingxing took the document and took a look. The S\u0026P 500 index rose by 2.14%, from 1310.41 points to 1338.6, an increase of 28.2 points.

I immediately calculated in my mind that Envision Capital currently holds 60,000 S\u0026P 500 index futures contracts. A one-point fluctuation is the contract multiplier of 250 multiplied by the number of contracts of 60,000, which is US$15 million. Multiplied by 28.2 points, the loss is 400 million. Many dollars.

Looking at the Nasdaq futures contract and the Dow futures contract, we also saw losses of hundreds of millions of dollars.

Today alone, the three major stock indexes lost more than one billion U.S. dollars.

This result is still based on the fact that the leverage is only opened 10 times.

Envision Capital used Goldman Sachs and Morgan Stanley to pay a US$10 billion margin to the CME Group. Currently, only half of the margin has been used to short-sell US$50 billion in stock index futures.

Among them, S\u0026P 500 index futures were short-sold at 1,400 points, with 60,000 lots worth US$350,000 per hand, totaling US$21 billion, accounting for nearly half of the position.

Another $29 billion was diversified into short-selling Nasdaq and Dow futures.

Envision Capital still has half of the margin on its account that has not been used. Once it is used, today's losses will double to more than 2 billion US dollars.

If the sting was not irritating, Xia Jingxing felt fine.

Because their accounts are still profitable, the S\u0026P index will not lose money until it rebounds to above 1,400 points.

In addition, since it is a forward contract, the loss is only a book number, not a real loss. The final profit and loss cannot be determined until the expiry of delivery or the position is closed midway.