Chapter 60: Ten Times Leverage Again
"What should we do next?" Zhao Xinyue looked at the stock market, eager to try.
"I want to increase the leverage tenfold!" Li Feng said seriously.
Lin Menghan and Zhao Xinyue were stunned when they heard this.
Zhao Xinyue was the first to react. She grabbed Li Feng and said worriedly:
"Li Feng, you, you should stop leveraging. Let's just lock in the profits, okay? This money is enough for us to use. Don't be too greedy and lose all your money."
Lin Menghan stared at Li Feng, but found that his eyes were full of determination, and couldn't help but ask:
"We're already in the middle of a bull market, and most stocks have doubled, tripled, or even quadrupled. If you leverage now, wouldn't you be letting others take over?"
After a pause, Lin Menghan said:
"Didn't you say that a bull market is all about finding the fool? If you leverage yourself in now, wouldn't you be the fool who takes the risk?"
Li Feng shook his head and said, "As the saying goes, if you don't make money in a bull market, there's no money to be made in a bear market. In a bull market, you naturally have to seize every opportunity and make a lot of money. Only in this way can you survive in a bear market."
"Also, this time I'm using ten times the leverage, not to buy stocks, but to invest in new stocks!"
"Investing in new stocks? What does investing in new stocks mean?"
New stock investor Zhao Xinyue was shocked.
Veteran stock investor Lin Menghan reacted quickly and asked:
"Using leverage to buy new stocks? Are the returns on new stocks really that high right now? Is it worth using ten times leverage? Don't let it happen that you end up losing your original capital instead of making any money."
Li Feng looked at Zhao Xinyue and explained, "IPOs, to put it simply, mean applying for new shares that are about to be listed. After winning the lottery and paying the deposit, you can sell them after they are listed... You can search Baidu for details..."
Then, Li Feng looked at Lin Menghan and explained:
"Ever since the IPO restarted last year, funds have been pouring into new stock subscriptions. Over the past few months, I've calculated that the winning rate is roughly 0.3%. The average stock price increase is around 300%, which translates to an annualized return of 20%! You only need 5 million yuan to guarantee a winning ticket!"
"So, as long as I can raise money at an interest rate of around 10% and use it to buy new shares, that's a 10% risk-free arbitrage. This is much safer than gambling in the market!"
"Only 10%..." Zhao Xinyue frowned.
Li Feng smiled and said, "Yes, it's only 10%, which is a daily limit. But, Xinyue, you have to know that this is a risk-free return. Only this kind of opportunity is worth my leverage."
"Also, don't look down on this 10%. My capital has reached 10 million yuan now, so 10% is 1 million yuan!"
Zhao Xinyue suddenly understood, but still felt aggrieved. She muttered, "Investing in new stocks is all about who has more money. This is too disrespectful to small retail investors..."
Li Feng was speechless.
In the stock market, it is like this, the strong prey on the weak. Many times, many opportunities are only reserved for those with large amounts of capital, and many permissions are only given to those who have reached a certain amount of capital.
In the cruel financial market, weakness is the original sin.
If retail investors want to survive and grow, they need to have more patience, study more strategies, improve their cognition, seize those fleeting opportunities, and take every step carefully to achieve ultimate victory.
After listening to Li Feng's strategy, Lin Menghan was somewhat fascinated and said, "Well, then I'll also ask my dad for some money and invest in it?"
Li Feng smiled and said:
"Didn't you contact Liu Ying a few days ago to open margin trading? You can borrow securities to buy new shares. You can ask Liu Ying about the specific operation. She has been shouting in the group every day these days. I will go to the boss to discuss the financing first."
After saying that, Li Feng went up to the second floor, knocked on the door and entered Gan Yitong's office.
The office is very large, more than 20 square meters, with a sofa, a large desk, a tea table, and several pots of green plants. A beam of sunlight shines through the window and onto Gan Yitong's rosy face.
Gan Yitong saw Li Feng coming in, stood up and said:
"Congratulations, Reporter Li! Congratulations, Reporter Li! Ten times leverage, you've become famous overnight! Come, let's have a taste of this Pu'er tea I just got..."
As he spoke, Gan Yitong began to make tea.
"It was just luck, just luck." Li Feng sat down and said politely.
Gan Yitong sat opposite, shook his head and said:
"Success is not about luck. I've carefully analyzed Reporter Li's investment success stories. They are truly classic examples of small investments yielding big returns. Upon closer inspection, they're truly astonishing."
"Oh, I heard you just unloaded your leverage. Are you here to repay your loan? If you pay it back early, I can give you a discount. We're old friends now."
Li Feng smiled and said, "Boss Gan, I don't want to reduce the leverage, I want to increase the leverage tenfold."
Gan Yitong was stunned when he heard this and flatly refused, "Reporter Li, the last time you used 10x leverage, you were buying convertible bonds. With a guaranteed floor, I gave you a 10x loan limit. Now it's a bull market, and there's no arbitrage potential with convertible bonds. You're still using 10x leverage? That won't work. Buying stocks with 10x leverage can wipe out everything in a single day's fluctuation!"
"We've seen too many margin calls these days. Reporter Li, no matter how good your stock trading skills are, don't be too greedy."
"Also, Reporter Li, although we're old friends, this company isn't solely mine. If you're going to increase your leverage tenfold this time, that's tens of millions of yuan. I can't make the decision on that."
As he was talking, Gan Yitong brewed the tea and gave a cup to Li Feng. He sipped the tea slowly, glancing at Li Feng's face from time to time, but found that Li Feng did not show any surprise or disappointment.
Could it be that Li Feng has other intentions when he increased the leverage to ten times this time?
However, in this bull market that is booming, where can we find such good investment opportunities?
He was a little confused.
Li Feng took a sip of tea and said slowly, "Boss Gan, we are not outsiders, so I will tell you the truth. I don't want to speculate in stocks, but to invest in new stocks."
"Invest in new stocks?" Gan Yitong had a very keen sense of money, and instantly thought of many things. He tapped the table lightly and asked, "What is the annualized return of investing in new stocks now?"
Li Feng smiled but said nothing, "Boss Gan, I've already given you the news. This 10x leverage loan..."
Gan Yitong looked at Li Feng and pondered.
If it is true as Li Feng said, there is something to be done here.
As long as you use money that is lower than the return rate of new stocks to buy new stocks, you can get a return rate that is much higher than that of capital allocation. The key is that there is almost no risk.
The message conveyed by Li Feng is of great value.
Gan Yitong thought for a moment and then changed his words:
"The stock market is getting better and better, and our company doesn't have much margin to offer you. So, don't repay your last 10x leveraged loan. I'll approve another 3 million yuan loan for you, but the interest rate will be higher. How about 10%?"
"Thank you very much, brother!" Li Feng thanked.
Now that the stock market is doing well, the annualized financing rate for stock allocation business is around 15%-20%. Even the financing rate of securities companies is basically around 9%.
Gan Yitong lent himself hundreds of thousands of yuan in total, which can be said to be very generous.
Not to mention, you can also use reverse repurchase and idle funds to roughly reduce the annualized cost by at least one percentage point.
Li Feng and Gan Yitong drank tea and chatted for a while, then went downstairs and entered the trading room.
Soon, news came that Li Feng had used ten times the leverage to trade stocks again.
"What? Stock God Li is going to use 10x leverage again? Are you crazy, me, or the stock god? What kind of stocks and technologies dare to use 10x leverage in real trading? Isn't he afraid that someone with ulterior motives will mess with him?"
"Oh, you're not crazy, I'm not crazy, and the stock god is definitely not crazy. I heard that this time the new stock is being bought with 10x leverage."
"Invest in new stocks? No, I have to go and take a look."
"Great! The stock god's strategy is different. I have to follow him again. Last time I followed him and bought tens of thousands of Bank of China convertible bonds, but unfortunately I sold them at 130 yuan. Sigh, I didn't have enough perseverance... This time I want to advance and retreat with the stock god!"
"You're not going to cooperate with me, I bet you'll change your mind in less than a month, no, a week."
"impossible."
"You always say that..."
Word spread quickly, and the news that Li Feng used ten times leverage to trade stocks started to ferment again, attracting waves of stock investors and reporters, who pushed the threshold of Hengtong Finance down.
Li Feng was exhausted. Looking at the stockholders outside the trading room, he regretted participating in this trading competition.
After drinking a cup of tea, Li Feng turned around and saw Zhao Xinyue and Lin Menghan staring at the stock forum.
In the stock forum, investors are very excited, and more than a dozen posts pop up in a second. At a glance, most of them are bullish.
Some are optimistic about the securities sector, some support the banking sector, and some list a lot of data, saying that now is the leverage bull market, and this year is a key year for "double innovation", and the sector with the highest increase should be in the ChiNext. Others are sharing their own strategies for hitting the board, their own short-term secrets, and their own various indicator techniques.
There are so many of them, it’s dizzying to look at.
Lin Menghan and Zhao Xinyue became more and more excited as they watched, their cheeks flushed red.
Li Feng looked at their excitement and sighed secretly.
A bull market is both an opportunity to get rich quickly and a place where people get poor quickly. Novice stock investors are often like these two people. They rush into the stock market with the hope of getting rich in their eyes, but in the end, they end up with nothing, just like they had a big dream.
There's no point in trying to persuade someone of this kind of thing.
You can only be educated by the stock market, and you can only learn in the stock market.
Well, instead of letting them stumble at other times or in other events, it is better to let them actually take the funds and enter the market to fight.
People are like this. Without experience, there will always be regrets. Without experience, they will not mature.
Just like the compensatory psychology in psychology, whatever a person lacks in childhood, he will madly pursue it when he grows up.
A typical example is that when children are young, their parents don't allow them to play games at all, but when they grow up, they will make up for it like crazy. When they are short of money when they are young, they will make money like crazy when they grow up...
Li Feng thought for a moment and said, "Xinyue, the stock market has reached the mid-term stage. As the saying goes, large-cap stocks set the stage, and small-cap stocks perform. In the next market, the focus should shift from the big players like banks, securities, and insurance to some small-cap stocks."
Li Feng pulled up a document from his computer and explained, "Take a look at these data. Six hundred thousand new stockholders opened accounts in one week, a six-year high. Margin trading is even more dramatic, reaching 700,000 accounts a month."
"I just asked Boss Gan about his stock margin trading business. It's extremely popular right now. Basically, new investors are getting financing at a ratio of one to one or two, and there are also some who are getting financing at a ratio of one to three or one to five."
"The flow of people is the flow of money. It can be said that whatever stocks new stock investors invest their money in will soar in value. In a bull market, money has the final say."
After a pause, Li Feng asked, "Xinyue, what stocks do new investors like?"
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I would like to use this chapter to commemorate the good times when I bought new stocks.
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