If you choose to short sell, the leverage of 100 times is even more daunting.
"Establish a position by buying 50,000 lots of Hong Kong stocks."
Chen Dong gave the order.
One lot of Hong Kong dollar stock index futures is worth US$100,000; 50,000 lots would be worth US$1.5 billion.
Excluding the cost of building the position, it is approximately HK$40 billion.
If the operation goes smoothly, with a return on investment of 40% to 60%, or a leverage ratio of 5, they can recover at least $7.5 billion in total unrealized gains.
However, if things don't go smoothly, Longteng Company will not only lose the $1.5 billion, but will also have to pay a huge amount of debt.
It took two days just to build up the HKD 40 billion position, by which time the HKD's value was already in a precarious state.
The Hang Seng Index fell 281 points, and the Hong Kong dollar depreciated from 7.35 to 7.65.
The Hong Kong Monetary Authority (HKMA) operated in accordance with the pre-established contingency plan, purchasing large amounts of Hong Kong dollars.
At this point, HSBC, eager to arbitrage its currency, had no choice but to sell its dollar assets.
Even with such limited resources, the Hong Kong Monetary Authority (HKMA) still struggles to operate. For every sell order Soros places, they take it.
In just one trading day, the Hong Kong Monetary Authority (HKMA) injected HK$1.8 billion to barely keep the Hong Kong dollar at the 7.5 mark.
At the same time, market panic is gradually spreading outwards.
Regardless of the Hong Kong Monetary Authority's response, many retail investors in Hong Kong began to sell Hong Kong dollars as a way to avoid risk.
"How many sell orders are left?" Du Xingzhi asked the analyst.
The analyst looked very grim and said to Du Xingzhi, "There are currently 100,000 shares on the market."
"This does not include sell orders that are currently being submitted for pricing."
The Soros Group, through its Hong Kong-based Yellow River Capital, has been dumping large amounts of Hong Kong dollars, causing panic in the market.
He looked at Du Xingzhi with great concern and said, "President, we only have $100 million in our accounts right now. If the central bank's stabilization funds haven't arrived by tomorrow, we might not be able to protect the money market."
Upon hearing this, Du Xingzhi pinched his temple hard.
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