Chapter 680 The largest short squeeze in history (5)

  Although Soros was stunned, he knew that the Frankfurt Stock Exchange would not let this matter go, but he took a reassurance.

   The Porsche family played too much this time, and it was too big for the exchange to sit idly by.

  …

  On Monday, when the opening gong just sounded, the stock price of Volkswagen Group was like a balloon inflated, soaring upwards. Within half an hour, it has risen from 160 euros to 220 euros, an increase of 37.5%.

  The rise in Volkswagen Group's stock price was within everyone's expectations, but the speed of such a skyrocketing increase has exceeded many people's expectations, because not everyone is aware of the total share of short-selling Volkswagen shares. Therefore, in this process, gradually a small amount of Volkswagen Group stocks began to be thrown out.

  Even so, the trading volume in the market is still very bleak, and only a mere few hundred thousand shares appeared on the buying side within half an hour.

   "The situation is bad, we can't buy enough chips!"

James Whitehead frowned, looking at the jumping numbers on the screen, with a heavy heart, "It's not just us, I believe other institutions feel the same way. The amount sold in the market is really too small. The public holdings on hand Those who hold shares in the group seem to be not very satisfied with the current price."

"Damn it, these greedy guys spit out all the profits, and it made them a lot of profit, they are still not satisfied?" Alan Howard was furious, but after losing his temper, he also helpless.

  Based on the analysis of the previous transaction volume and price, the analysts of Brevin Howard gave a possible closing price range: 250 Euros to 380 Euros. Strictly speaking, this interval seems absurd and imprecise. But analysts who are proficient in psychology, behavior and statistics dismissed Alan Howard with just one sentence, "The actual number may be far higher than the number we calculated."

   As a professional fund manager, Alan Howard is well aware of his situation. If he is the long side, he will maximize the pursuit of profit under the current situation, but it is a pity that he is the short side and needs to close the position. The only good news is that many of the bulls are non-professionals, and this kind of investors who give up a little bit of sweetness and give up the big ones are their hope.

  In fact, most of the hedge fund managers who need to close their positions think so. This is also the reason why the stock price of Volkswagen Group only rose by a mere 37.5% after half an hour of trading time after the market opened.

   Of course, in the eyes of others who don't know the inside story, this kind of rise has been extremely crazy.

   "Raise the quotation, and all the sales orders below 250 euros will be wiped out!"

  This unintentionally formed "price alliance" is undoubtedly unreliable, because everyone needs to close their positions, and temporarily lowering the price will not have any effect on the main bulls, and the other party is likely to be a professional. So after quickly measuring the situation, Alan Howard ordered decisively.

"it is good!"

James Whitehead agreed without the slightest hesitation, and then, together with other traders, quickly placed orders on the computer, "Huh? The price has risen to 240 euros!" He slammed the confirm button on his hand as he spoke, " Someone is faster than us!"

   "It still appeared after all!"

  Alan Howard closed his eyes, his expression showing deep tiredness, "It still appeared!" He murmured and repeated.

   Obviously, the main bulls are sitting firmly on the Diaoyutai, and they are completely indifferent to the current rally. In this case, once someone on the short side can't hold back, the entire "price alliance" will immediately fall apart. Alan Howard originally wanted to be the first person, but he was preempted.

  The situation in the market suddenly changed suddenly.

  Suddenly a large number of buy orders appeared on the shares of the Volkswagen Group, which were originally at 220 euros. First, the price was raised to 240 euros, and then jumped to 250 euros. The change in just one minute is dizzying. But in the eyes of experts, they interpreted different meanings, and the bears couldn't hold back.

  The trading volume became active, and some investors began to try to sell the shares of the Volkswagen Group in hand, but they soon gave up this idea, because the stock price of the Volkswagen Group rose wildly again.

  260 euros, 270 euros, 280 euros...they jumped up to 300 euros before barely stopping.

"what happened?"

"What exactly is going on?"

  The people who sold before beat their chests and regretted it. Investors who did not sell were panting uncontrollably, full of fear. They also know what caused this situation, but the current stock price has far exceeded their expectations.

  The 300 euro price point is significant because it means that short hedge funds lose half of their money on the VW Group position. If a hedge fund has shorted 100 million euros of Volkswagen Group stock, based on the average selling price of 200 euros some time ago, they must now buy back the same amount of shares for 150 million euros.

  The reason why it is very important is also because this number is the minimum ratio for most brokers to maintain positions, because the leverage of general brokers is maintained at 2, and when this limit is exceeded, the loss is likely to spread to the broker itself. So at this time, the broker will either notify to make up the margin, or force the position to be closed.

  The party who is reluctant to sell is naturally very clear that this price is the psychological position for short positions. Basically, when this price is reached, it means that the bears have disarmed and surrendered. At the same time, a return of 50% or even higher is already an acceptable profit for them.

  The trading volume began to increase, and several million-share sell orders appeared in the market one after another, and the bull camp began to waver.

The stock price of the Volkswagen Group began to hover around 300 euros for a while. On the one hand, the buyer completely conceded defeat, and the seller felt satisfied after measuring the benefits. up.

  But none of them realized how dangerous people's hearts are in this world.

Less than five minutes after the "orderly" transaction between the two parties, the market experienced drastic changes again. A single buy order with a value of up to 1.5 billion euros appeared on the market, and the sell order on the market was almost sold at lightning speed. It was swept away, and immediately pushed up the shares of Volkswagen Group to 320 euros.

   "This...how is this possible?"

   Alan Howard, who had been staring closely at the board, was so surprised that his jaw almost dropped, the corners of his mouth twitched twice, and he cursed almost hysterically, "Who the **** is this? What the **** is this guy trying to do?"

   Just a minute ago, the trading volume of the entire market reached about 8 million shares, which means that the short seller bought 4 million sell orders in the market at an astronomical figure of more than 1.2 billion euros. In addition, the remaining money wiped out the sell orders below 320 euros.

   "Boss, the broker called and urged us to pay the deposit!"

   Just when Alan Howard was furious, James Whitehead handed over a microphone with an extremely ugly expression, "They said that if we fail to pay the margin in time, they will liquidate our positions."

   "Finished? Let them be forced!"

Alan Howard is about to lose his mind now, so naturally he can't bear the slightest threat, "Tell them, if they are willing to force a tie, then let them do it." After taking a few breaths, he added, "If they don't close their positions, we will take all the losses. Let them figure it out!"

  The current situation makes it very difficult for brokers. If they force liquidation, they will basically suffer losses. Although this part of the loss can be recovered in the future through legal procedures, once it enters into litigation, it will take a long time, and not all brokers can afford it. Alan Howard seized on this point of the broker, and in turn threatened the broker. He knew that his position was too heavy, enough to hold the broker hostage.

   Sure enough, two minutes later, James Whitehead hung up the phone, nodded slightly at him, and signaled that the deposit matter had been settled.

   It's just that the price of the Volkswagen Group has risen by 350 euros at this time, which means that the loss has further expanded.

  Between the minute of James Whitehead's call, the nasty effect of selling off the market with large orders had begun to simmer, because it highlighted a fact that the bulls might have overlooked: the size of the bears was far greater than they imagined.

With this discovery, basically the bulls began to be reluctant to sell again. The sell orders thrown out in the market were only about tens of thousands to hundreds of thousands of shares, which was nothing to those big crocodiles. This made them re-evaluate the scale of short selling Come.

Although there is no large-scale transaction volume, the current increase has exceeded 100%. For some investors who are still unclear about the situation, this rate of return is enough to satisfy them. Some of the small-scale sales in the market are from Their hands, the other part is the temptation from the main bulls.

  The price is still rising, and the bulls are still testing the bottom line of the bears. And many short sellers are forced to buy sells in the market while bleeding, because they know very well that if they don't buy at this time, the price will be higher at the next moment.

   In this way, the price was pushed up to 400 euros in the pain and helplessness of the bears.

  Compared to 300 euros, 400 euros means that short positions are completely lost and all positions are lost. At this time, there are two options for the bulls. The first is to take the opportunity to ship and completely win the funds of the shorts. On the other hand, they continue to wait and see, hoping to sell at a higher price, but the potential risk is that the short sellers are unable to continue to pay or may even be completely finished, and it may take a while to get it. What is even more extreme is that if the opponent goes bankrupt, this time will be even more distant.

   Just a little weighing, some of the main bulls chose the former. After all, cash is king at present, and it is the safest strategy to be safe.

  The trading volume in the market began to increase rapidly, and the willingness to sell increased significantly. In just half an hour, there were more than 6 million shares of Volkswagen Group on the market, and several sell orders exceeded 500,000 shares.

   "Buy it quickly, as long as you can buy it, the price is not a problem!"

  Faced with the liquidity suddenly released by the bulls, the market was somewhat unprepared, and prices fell for a time. But for Blevin Howard Asset Management Company, the liquidity they finally got has left them no choice. Alan Howard even said "regardless of price", and then he added, "In Put up some buy orders at a high level, and if that mysterious buyer reappears, we can at least grab some of them.”

He was a little scared of the unexpected situation just now. Although Brevin Howard Company has completely wiped out the short positions of the Volkswagen Group at present, Alan Howard has decided to accept the situation and only hopes to close the position as soon as possible. No more losses.

  Blevin Howard has the capital to absorb these losses, but for other hedge funds, although these losses are unlikely to bring them a real disaster, they are already enough to hurt them.

  But in addition to these two types of people, there is a third type of people who are helpless against the current long-squeeze and unwilling to close their positions at such a high price. Soros is one of them.

  Minimize as much as possible, Soros thought viciously.

   PS: Let me tell you about the arm. On the afternoon of the 2nd, I went outside to participate in an experience activity, because I was too excited and fell to the ground. I fell down because I was holding something in my right hand and I was running very fast. The right elbow hit the concrete floor, and when I subconsciously made a protective movement (turning around and hoping to land on my back), my left palm rested on the ground, and the left hand was not seriously sprained. I went to the hospital to have a look at my right elbow, and the doctor said that the bone was fine, it was just a sprain, and it will be fine after a period of recuperation. When I came back, I used hot compresses and cold compresses. Up to now, my arms are still only semi-fixed, and the pain is unbearable if it deviates from the angle. Now the swelling of the left palm has basically subsided, and I can type. I will give it to everyone first. The right arm may need a period of recuperation to recover. I am so sorry. Everyone must pay attention to protecting themselves when participating in activities, safety first. Don't get carried away like I did, and then the joy turns into sorrow.

  

  

  (end of this chapter)