Chapter 673 Fanning the flames

  Frankfurt, Deutsche Bank headquarters.

  When Werner Heisenberg reported the news of the hedge fund's additional short-selling quota, it did not attract enough attention. But when more and more traders began to report upwards, the news attracted great attention from Deutsche Bank.

"what's going on?"

  The managing director of the trading department, Med Harvey Lal, urgently gathered star traders together and carefully asked for details.

   "Element, an American hedge fund

  Capital suddenly requested to increase the share of shorting Volkswagen Group stocks, and the increase was as high as 75%, almost doubling. God, if their request was granted, it would be equivalent to betting almost one-third of their total capital on shorting Volkswagen Group shares. "

   Werner Heisenberg said with lingering fear, the expression on his face faithfully reflected his heart at the moment, that is, he was shocked.

  Generally speaking, no matter what type of hedge fund it is, its largest holdings do not exceed one-tenth of its total fund management size. This is a typical hedging behavior of "not putting eggs in one basket". But for some small hedge funds, there are more aggressive investment methods. For example, this hedge fund called Element Capital, its original short-selling funds on the Volkswagen Group was close to one-sixth of the total fund management scale. This was considered an extreme approach in the industry, but now it is added. How can we not make Werner Heisenberg feel terrified?

Of course, for hedge funds, this aggressive investment method does not necessarily represent moral hazard. Perhaps most of the money in it is the founder's own, just like the current Quantum Fund. In fact, most of the funds have already been invested. It's from the Soros family. Or it may be that the decision-makers are eager to open up the market, gain fame, and obtain more management funds. But no matter what the purpose is, this method is definitely not worth encouraging.

   "Besides them, Caxton

  Associates, MooreMacro and many other American hedge funds. "Werner Heisenberg continued, "I don't know why, the entire hedge fund industry seems to be crazy, especially the hedge funds in the United States. "

   "Your situation is similar?"

Medhavi Lal pondered for a moment, and when he asked other traders, he got almost the same answer, "So, they are collectively optimistic that Porsche will not be able to complete this acquisition, because the Porsche family issued an announcement Ambiguous speech? That seems too much to justify."

   Regarding the news released by the Porsche family, Medhavel Lall was naturally the first to get the news. He and his colleagues only analyzed it for a while and decided that it was fake news released by the Porsche family. In addition to not being certain, the identity of Schwartz Porsche has also become a problem. As Germany's top local brokerage, analysts at Deutsche Bank quickly came to the same conclusion as other market analysts.

  Medhawi Lal even believes that the "performance" of the Porsche family is clumsy and naive, and anyone who winks or understands the grievances of the Porsche family will not understand it as they want to lead.

   But now a problem has arisen. The Porsche family may continue to take the shares of the Volkswagen Group toughly, but hedge funds are just around the corner, thinking that this acquisition cannot be successful. This almost clear-cut judgment made Medhavi Lalton confused for a moment.

   "It doesn't make sense! It really doesn't make sense!"

  Medhavi Lal pulled his hair and thought hard, and soon his meticulous hairstyle was messed up like a bird's nest.

  When the traders saw this scene, they smiled at each other and shook their heads. Medhave Lal is handsome and tall, he is a typical handsome Germanic man. On weekdays, he also pays great attention to appearance, custom-made suits, leather briefcases, and high-end leather shoes that are always spotless. And, of course, there's the jar of hairspray stashed in his briefcase, which he always has in hand to style his hair.

   It is precisely because they know about Medhave Lal's "hobby" that the traders looked at his messy hairstyle at this time. But their sniggering didn't last long, and soon one of them's phone vibrated, first, then others, and then everyone knew the news.

   "Soros is here?"

Medhave Lal's brows widened in an instant, "So that's the case, no wonder! Since he personally made the move and also appeared at the headquarters of the Volkswagen Group, it seems that he really intends to get involved in this transaction Among them. It must be because of this news that hedge funds all over the world have united to short the shares of Volkswagen Group!"

"It should be like this!" Werner Heisenberg also had a look of sudden realization, "At the same time as him, there was also a hedge fund boss, Mr. Zhong Shizhong from Hong Kong Tianyu Fund. But according to CNBC According to the report, the gentleman denied the possibility of being involved in the acquisition. In this way, it is certain that Soros will definitely be involved, but for Zhongshi, it should not be, after all, judging from his public statements See, this man never lied."

"Since this is the case, let's ignore him!" Medhave Lal waved his hand, dismissing the biggest X factor in the incident lightly, "Werner, we hold a total of How much, can it support the short selling of these hedge funds?"

  As one of the largest market makers in the Frankfurt market, Deutsche Bank itself holds a considerable number of Volkswagen Group shares and is one of the minority shareholders of the Volkswagen Group. Of course, the shares it holds are for long-term investment, and they are not easily sold. Even if Porsche annexes the Volkswagen Group, it will not have much impact on their investment. For the consideration of market makers, they also often lend out this part of the stock to short, taking the opportunity to earn part of the interest.

"The 3.5% equity has not changed." Werner Heisenberg replied in a deep voice, "2.1% has been lent out in the early stage, and only 1.4% of the equity is left, which cannot meet the requirements from hedge funds at all. I estimate that if To meet the short-selling requirements of hedge funds, at least increase to 5% of the equity or even more. But it is impossible for us to increase the shares of Volkswagen Group at this time, and their share prices are too high."

"Yes, their stock prices have already deviated from the fundamentals." Another trader named Andre Carlson also echoed, "Including growth expectations, their stock prices are at most between 70 euros and 100 euros. It is still obviously overestimated. If we increase our holdings now, we will obviously be taken advantage of.”

"I think so too!" Werner Heisenberg nodded in agreement, "If we can't increase our holdings, then we have to find other cash bonds from the market. Gentlemen, mobilize your contacts as soon as possible and go to the market Look for cash bonds that may be borrowed. By the way, the interest rate is absolutely impossible to exceed the interest rate we lend."

   After dismissing the traders, Medhavi Lal sat in the meeting room and thought for a while, then made a call.

"Mr. Roger, hello." Medhavi Lal said respectfully, "I'm Medhavi from Deutsche Bank. How are you doing recently? I don't know if you are free, I would like to invite you drink a cup of coffee."

   "It turned out to be Mr. Medharvey!" There was a burst of hearty laughter from the microphone, "There is no need for coffee. Mr. Medharvey is calling for something, is it about the shares of the Volkswagen Group?"

   "How do you know?" Medhave Lal blurted out in surprise, and he immediately realized, "Another colleague has already looked for you? Mr. Roger?"

"That's right!" The gentleman named Roger said with a smile, "Med Harvey, your news has been seriously delayed. Before you, Dro Securities and Hadir Asset Management have already called to report to you. I borrowed the shares of the Volkswagen Group. If I didn’t believe that you would definitely make this call, I would have agreed to lend them the cash coupons.”

   "What?" Medhave Lal's heart sank. He knew the companies Roger mentioned, and he was also one of the famous market makers in the Frankfurt market. And he is also very clear that if it weren't for the large scale of his own bond lending, Roger might have already lent out the cash bonds, "They have already acted? It seems that hedge funds are very determined to short the Volkswagen Group, and it is already serious." affect market makers."

"Six months, 3% annual interest rate, these are my conditions for lending!" Roger quickly offered his own conditions, "1.5% of the shares can be lent to you. Med Harvey, you should be very happy Be clear, if you look at the past friendship, I will definitely not leave it to you."

   I have to say that the conditions for this securities lending are much higher than the market price, but at this time, it is basically impossible for Medhawi to find a larger scale of securities lending in the market, so he can only hold his nose and agree.

"These are just minor problems!"

  Med Harvey just pondered for a while, and then responded decisively, "But Mr. Roger, I have a question, don't you worry that the Volkswagen Group is really acquired by the Porsche Group?"

"Worried?" Roger chuckled, "Why should I worry? This is a civil war in the Porsche family, and it has nothing to do with me, an outsider. Besides, it is not necessarily a bad thing for Porsche to enter the Volkswagen Group. It's been too long, it's time for a change!"

  As a minority shareholder, the wishful thinking of this Mr. Roger is nothing more than sitting and watching the internal struggles of the Porsche family. No matter which side it is, they need to win over people like him. Piëch needs their support to defend Volkswagen, and the Porsche family needs them to sell their shares. No matter what the final outcome of the struggle is, in the end he can transfer the shares at a higher price. And most importantly, even if the Porsche family fully controls the shares of the Volkswagen Group, that is, holding 75% of the shares, shareholders like him can also board this big ship and make long-term investments.

   So in this case, they lent the stock, no psychological pressure at all.

"It's not just me, even the other shareholders, I've heard that they are about to move." Roger then broke out another news that surprised Medhavi, "A good show is going on, maybe Pi Jesch himself lent the shares. You know that can burn Porsche's cash fast!"

   "Are they planning to squeeze short?"

A thought quickly appeared in Medharvey's mind, but he denied it the next moment, "How could this create a short squeeze? There are at least 30% of the outstanding shares in the market, and the shares of the Volkswagen Group are increasing every day." The turnover rate is as high as 10% or more, and it is absolutely impossible to form a short squeeze.”

   It's a huge shame that his attention was quickly drawn to the phrase "burn Porsche cash fast" and it didn't go in the right direction. But at that time, who could have imagined it.

After borrowing 1.5% of the shares, Deutsche Bank held a staggering 5% of the Volkswagen Group shares. At this time, Med Harvey let the traders announce that Deutsche Bank has a large number of Volkswagen Group shares on hand. Welcome hedge funds to come to securities lending. For a while, hedge funds from all over the world were calling Deutsche traders, hoping to borrow shares of Volkswagen Group to short.

  Because of the hype of the market makers, there are more and more funds for shorting the big group. With fanning the flames, the fire simply grew stronger and stronger.

   Thanks to book friends Xingxiyuelang, Spring Arrives, Flowers Blooming Early, Xiaoxiang Night Rain, Foreigners, cpower, qhiou, njluyujiang, and 890 for voting monthly! Thank you book friends for rewarding again! I'm sorry to be a little slow. Recently, the investigation has been very strict, and ambiguous plots are no longer allowed to appear. Although the author has not touched on this aspect, there are still some places that seem to be rubbing the edge, and are desperately revising...

  

  

  (end of this chapter)