Chapter 74 Wall Street still makes money faster

The London gold market is different from stock markets in various countries due to time differences.

It operates 24 hours a day and only closes on weekends.

But if you are willing to try the smaller Middle Eastern region.

Since there are no weekends in the desert, it can be said in theory that the London gold market and the foreign exchange market operate 24 hours a day, 7 days a week.

This time Milo asked Nelson to use five million dollars.

He obtained 400 times leverage from several banks including Citigroup, Morgan Stanley, State Street and Wal-Mart.

The reason why it is four hundred times, instead of 10-80 times as Nelson originally said, is because this is a special multiple in the London gold market.

10-80 times, that’s the multiple in the stock market.

Most of the platforms that deal in London gold start with a profit of fifty or even a hundred times.

You don’t even need to apply, the platform will give it to you.

For higher multiples, you need to apply in advance.

There are outrageous cases where the amount is even thousands of times, but the amount of capital used is generally small.

The leverage of this type of financial derivatives is so exaggerated, for example, the foreign exchange market is similar.

After the credit line and funds are obtained.

As a layman in finance, Milo planned to go all in.

After all, both his father's side and his memories told him.

This wave of gold is going to rise.

But in the end he was persuaded by Nelson.

Nelson said that if the full 400 times leverage was used.

If the market only rises or falls by about 0.25%, they will have to pay more margin or lose all their money.

On Wall Street, and even in the global financial market, when doing this kind of financial derivatives, even if you know there will be big market trends and black swans.

Generally, you try to get as many times leverage as you can.

However, it is best to buy as little as possible when buying, so as to have more margin left to prevent a margin call.

Milo followed suit because he didn't know whether his memories were reliable.

So in the end, even though the leverage was still as exaggerated as 400 times, it was not a full buy.

Nelson drew a safety line and kept as much deposit as possible.

But even so, before Milo left the hotel in the morning, Paladin Investment Company's paper loss was still as high as more than one million US dollars.

But half an hour later, when he arrived at the company, the floating loss had decreased a lot.

"This should be someone inducing short selling in advance. This way, they can reap as much as possible in the next bull wave," Nelson judged.

Milo nodded, though he didn't quite understand.

A little better than a layman, two of the seven orifices are open.

He is still learning, learning about Wall Street.

Seeing this, Nelson explained to him while directing the traders to work.

"The leverage ratio of London gold is generally very high. On the one hand, the fluctuation of price increase or decrease is small, and on the other hand, the trading threshold is very high."

"If you don't use leverage, each transaction requires at least one lot, and one lot is equal to 100 ounces of gold."

"The current price is around $370 an ounce. 100 ounces costs more than $37,000. If you don't use leverage, the market threshold is too high."

Now Paladin Investments has $5 million, of which $3 million will be used as a deposit.

The remaining two million dollars will be used as operating funds.

After raising funds from several banks, with a leverage of 400 times, the available operating funds were 800 million US dollars.

If you buy all of them, you can buy about 22,000 lots.

But if I really bought all of them, based on the market conditions from last night to this morning, I would have been liquidated several times.

Nelson's trading method was to add a few hundred lots every time the market dropped by five basis points, because his position would be liquidated if it exceeded ten basis points.

Fortunately, I had enough margin, so even though someone was trying to lure me into a short position last night, I still held on.

Wait until 1pm today.

This wave of market conditions brought about by the US dollar interest rate cut has not yet fully started.

But there are already signs that the price of gold has been rising.

At half past one.

More than 50 accounts of Paladin Investment Company, which had been suffering from floating losses for most of the night, finally showed a little floating profit.

Two o'clock in the afternoon.

The Federal Reserve went to work and announced its first interest rate cut this year.

International spot gold, which has been brewing for a long time, has finally begun to climb upward.

This wave of gold prices has been rising wildly.

to 5 p.m.

At this time, the assets held in Milo's account had reached 450 million US dollars.

Among them, 440 million is financing funds, which must be repaid.

Only $2.85 million actually belonged to him.

After deducting the principal and interest, he still had a profit of about 5.8 million US dollars.

"That's more than five million?"

Milo couldn't help but marvel at how quickly the money came.

No wonder the entire United States has chosen to move away from the real economy and toward the virtual economy. The money-making in the financial sector is coming like an avalanche.

Five million, you can earn more than five million a day!

The latest novel is published first on Liu9shuba!

Many manufacturing industries cost $100 million, but they don’t know if they can earn $5 million a year…

And it doesn't seem difficult, as long as you know the market conditions in advance.

Milo could see that

Nelson basically did not do anything, just added to his position when the price dropped, and held on to it and waited and saw when the price rose.

However, there was one time when the intraday decline fluctuated greatly, falling 14 basis points in an instant, and I almost went bankrupt.

Fortunately, the logistics were sufficient and Nelson quickly added margin to avoid forced liquidation.

High leverage is a game of heartbeats.

Pay full attention and don't be careless for a moment.

It was still a bitterly cold winter in New York at the end of January, and the sky was already completely dark by five o'clock.

Milo leaves the trading room.

He walked to the floor-to-ceiling window on the side of the corridor, opened the curtains, and looked at the lights on Wall Street outside.

The high-rise buildings were bustling with activity, and many floors of the skyscrapers were lit up at this time.

There should be a lot of people working overtime on Wall Street tonight because the market is so good.

Nelson was still very excited. As he escorted him out, he said, "...There are two ways to lock positions: profit locking and loss locking."

“When the market moves in the opposite direction to your operation, you open a new position opposite to your original position, so it is also called locking.”

"The purpose of locking positions is mainly to deal with possible reversals in the market, so that the positions in hand are in the best position with the lowest cost."

Nelson was continuing to teach him about finance.

At the same time, let Milo have a deep understanding of the trading rules of London gold.

Even though Milo has good logic now, he also has a photographic memory.

But it was not difficult for him to understand going long or short, except for locking positions, which he did not quite understand.

It sounds like it is intended to help investors reduce risks and appropriately avoid losses.

But he feels that locking positions should be used as a means of profit rather than a conventional remedial measure.

But it doesn’t matter, because I have a Capitol Hill stock god at home.

What's more, I have special memory abilities.

After verification today, Milo found that it can indeed be used on Wall Street.

No wonder there are so many stock market gods on Capitol Hill! Their returns are far better than those of Buffett and Soros. There is a reason for this.

Nelson escorted Milo out of the trading room and the general manager returned to the trading room.

The market has not ended yet, and Nelson feels that he should be able to make more money from this gold trend.

For at least the next two days, he and the dozen or so traders will continue to stay in the trading room.

That’s right, the kind where you eat, drink, defecate, urinate and sleep.

This is very common on Wall Street, whenever there is a good market or any action is initiated.

The traders and relevant persons in charge of those investment banks or speculative companies would work all night long like this.

As for Milo.

At this time, he had already met Monica, who had come in the afternoon and had been waiting for him for two or three hours.

Making money is the job of workers.

If he, as the boss, has to do everything himself, then isn't he just being a boss in vain?

Nelson, work hard and try to get your boss to have more Hollywood girls next year! (End of this chapter)