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- The Futures Department of Dahua Industrial has already made preparations and will start closing positions at a very fast speed when the order comes down.
In the process of closing positions, the price difference that was originally expected to converge has a tendency to expand further. This is because many traders discovered that millions of barrels of crude oil that should have been shipped to New York were instead sent to London. This practice led to an increase in inventory in the London delivery warehouse and a decrease in inventory in Cushing, further lowering the price in London and giving rise to the price in New York.
Riding on this trend, Dahua Industrial has almost completely pocketed the profits from the CFD contracts. The total amount is as high as 5.2 billion US dollars, far exceeding Qi Xiao's expectations.
In fact, it was a bit beyond Su Cheng¡¯s expectations.
Seeing this entry, Qi Xiao, who was busy with his busy schedule, spent three luxurious seconds in a daze. The fourth sister, Xu Feng, who was far away in China, immediately called Su Cheng and asked: "Suddenly, a large sum of money suddenly appeared in several accounts of our company I counted it several times"
"It's the company's profit. I'll elaborate on it when I get back." Su Cheng interrupted her with a smile.
"So many?"
"yes."
"How did you do it?" Although the fourth sister Xu Feng did not have a professional background, she is diligent and studious. She is very suitable for the supervisory position in the financial department of Dahua Industrial. Most of the capital flows within the group are under her supervision. under.
It¡¯s not like Xu Feng has never seen billion-dollar funds, but this is the first time he has made billions of dollars in one-time income.
Su Cheng smiled bitterly and didn't know how to explain it, and said: "It's half luck and half preparation. It's a bit beyond my imagination, but there are due procedures. You can also contact several banks with accounts to see if they have any requirements. The fees paid will be handed over to them."
Dahua¡¯s major overseas banks are all very powerful large commercial banks, or local cowards with strong local backgrounds, and are best at handling government relations.
The disadvantage of CFDs compared to pure futures contracts is that they have to pay handling fees to two exchanges. However, the handling fees of futures exchanges have always been very small, because they are essentially a club serving members and do not For the purpose of profit, although Dahua Industrial has made billions of dollars, the handling fees it can pay are similar to those of financial institutions that make millions.
As for taxes, there is absolutely none. In 1994, the U.S. government was discussing taxing futures exchanges to alleviate the current financial difficulties, but there was no result yet. Since Margaret Thatcher's small government and privatization, it has been even more difficult for London to add new taxes. Currently, the four regions that currently collect futures trading tax are Japan, Finland, France and Hong Kong. Among them, Japan levies a tax at 20,000% of the closing price, Finland levies a tax at 50,000% of the closing price, France has a fixed transaction tax of 0.05 francs per order, and Hong Kong levies a tax of HK$5 for each completed transaction. , all four regions are different, but in general, futures tax is still a small tax. No matter what method is used to levy the tax, the total amount is very small and insignificant.
In comparison, the handling fees for exchange traders and banks that provide leverage funds are more, but they are only millions of dollars.
Therefore, after deducting all expenses, Dahua Industrial has made more than 5.2 billion US dollars in profits through CFD contracts, and there is still more than 5.2 billion US dollars left.
"As for the Dahua Group, it is 100% in Suzhou's hands from beginning to end.
With this money in hand, Su Cheng felt much more at ease.
Qi Xiao¡¯s blood was still boiling, and his lips were chapped as he said: ¡°Dr. Su, do we want to buy another contract with a narrowing spread?¡±
It is full of gambling, but it is also a normal idea. When the price difference widens to 2.2 US dollars, reversely buying a contract with a narrowing price difference has low risk and high profit.
After all, how much can the price difference of $2.2 widen to? Whether it is an increase in crude oil prices in London or a decrease in prices in New York, the price difference between the two will narrow.
If it returns to the $1 range, there will be so much profit again.
Nowadays, there are probably not a few financial institutions that make such contracts.
However, when Su Cheng was studying petroleum finance, crude oil CFD contracts often exceeded 15 US dollars, and sometimes even exceeded 20 US dollars. The price difference of 2.2 US dollars really did not make him feel safe, so he decisively refused: "Just speculate once." , now we need to close our short positions as soon as possible. What¡¯s going on with Sumitomo Corporation?¡±
Qi Xiao was also shaken with relief. He adjusted his mood in a flash and replied: "It seems that Sumitomo has done nothing. The possibility of quietly selling long orders cannot be said to be impossible, but it is not too great. I asked someone to check the long and short positions just now." Traded, if Sumitomo reduces its position, we will find it.¡±
Of course Sumitomo didn¡¯t take any action, SumitomoThe trading company and his allies have fallen into sluggishness.
Just like the Pan-Asia Fund, which has a heavy position with short orders and cannot retreat easily, Sumitomo Trading Co., Ltd. also holds a heavy position with long orders, and cannot take a trip at the drop of a hat.
What¡¯s even more troublesome is that since Michio Matsumoto has the support of the trading company headquarters, some affiliated companies attached to Sumitomo Trading Company, as well as allied companies such as Ito Trading Company, have made heavy bets in the range of US$15 to US$16.
Of course, this is also due to their greed. They always feel that the crude oil price of 16 US dollars or 15 US dollars is low enough. At worst, they can wait until delivery and transport it back to the country However, in the US$300 billion long-short exchange, , waiting for delivery is basically impossible.
For every 10 cent drop from the average price of US$16 to US$17, the Pan-Asia Fund can earn US$1 billion to US$2 billion, which is equivalent to freeing up US$1 billion to US$2 billion of margin, thereby leveraging it again Funding of US$15 billion to US$30 billion.
By contrast, Sumitomo Corp. and their allies will lose $1 billion to $2 billion in guarantees for every 10 cent drop in crude oil prices. When this number drops to 50 cents, Sumitomo Trading Co., Ltd. will need to continuously increase margin calls.
Otherwise, once the position is liquidated, all the long orders will be sold directly by the system, and no matter how much they sell, they will lose even a cent of their margin, which is equivalent to a big loss and a total loss.
Therefore, in order to avoid liquidation, Sumitomo Trading Co., Ltd. must continue to invest more funds as margin.
¡°When the price of crude oil fell below US$15, there were very few banks willing to provide sufficient financial guarantees to Sumitomo Corporation.
Sumitomo Trading Company itself is a financial trading company. In the initial stage, they can receive continuous financial support from the trading company, even if they suffer huge losses.
" However, when Sumitomo Trading Company's bank funds were exhausted, there were very few banks willing to act as cash machines for them, and the amount was difficult to replenish their needs.
This is completely opposite to Pan Asia Fund.
On the one hand, the seven shareholders of Pan Asia Fund were well prepared and spent several months using various means to obtain financing support from banks in many countries. On the other hand, and most importantly, Pan Asia Fund Always winning.
Their margins are not getting smaller and almost exhausted, but are getting more and more.
Therefore, in the later stage of the long-short war on the London International Crude Oil Futures Exchange, it basically turned into Pan-Asia Fund using more than 15 times leverage to bet against companies such as Sumitomo Corporation with 10 times leverage, or even five times leverage. The difference is self-evident.
This is a huge long-short bet worth US$300 billion. Even if it is leverage, a bank must be willing to provide it. Although Sumitomo Corporation has many assets, it does not have such a huge capital pool.
Now, let alone holding long orders until the delivery day, holding huge long orders overnight can scare the old men on Sumitomo's board of directors out of Alzheimer's disease.
Whether it is Sumitomo Trading Company with assets of 300 billion US dollars, Ito Trading Company with assets of 100 billion US dollars, or Soy Sauce Company with assets of 10 billion US dollars, they all have business needs of tens of billions, tens of billions, or billions of dollars in transaction volume every year. How could it be possible to put all the funds on the London Futures Exchange?
The directors are willing, but tens of thousands of employees in other departments are not willing; the employees are willing, but the Japan Financial Services Agency and the Ministry of Finance are not willing; if the Japanese are willing, the British will probably laugh out loud about Alzheimer's disease. Hundreds of billions of dollars more will be realized out of thin air, and they will not be realized until August, September, October, and November.
Such a large sum of money may be able to help the UK increase its GDP by two points.
¡°In the final analysis, such a huge amount of futures trading can only be short-to-short.
Waiting for delivery? Billions of dollars will do, tens of billions of dollars will do, but it won't help.
Short squeeze? It is possible in small markets such as agricultural products, but it is basically unfeasible in crude oil futures trading, which accounts for one-half of the world.
Michio Matsumoto stayed in the office of the exchange all the time, holding the coffee cup in his hand, almost crushing it, but after all, he did not wait for the moment of rebound.
At 19:00 in the evening, the secretary reminded as usual: "The manual market will close in half an hour."
Michio Matsumoto¡¯s eyebrows suddenly stood up, and he habitually looked at the big screen: 14:22.
No need to look at the two numbers at the end, the $14 in front left him with no energy at all.
"So much money has been invested this guy Hirano." Matsumoto gritted his teeth. Since coming to London, the beautiful window period of 15 dollars has ended. Even if he wants to play any role, he has no chance. He has invested a lot of money, but has no effect.
Although he is not sure that he can seize the beautiful window period of $15, this does not mean that he will not complain about Hideto Hirano.
??Especially before making a tough decision.
"Minister?" The secretary was worried that Matsumoto didn't hear clearly and wasted time. In half an hour, the manual trading is about to end. Unlike Pan Asia Fund, which signed three dealers in advance, Sumitomo Corporation has always only had one dealer of its own. seats, efficiency is relatively low.
The decision of whether to hold a heavy position for another night should be made in the next ten minutes or so.
Michio Matsumoto couldn¡¯t help but pull his hair, and asked in a low voice: ¡°Calculate, how much will you lose if you close the position now?¡±
Closing a position means leaving the market, and there is no chance of making a profit.
If it¡¯s in a casino, this means not even looking at the hole cards and announcing ¡°no more¡±.
The secretary had been with him for a while, so he didn¡¯t need to do any calculations and just said: ¡°The loss is more than 5 billion US dollars.¡±
US$5 billion is one-sixth of Pan Asia Fund¡¯s profit, which seems relatively small in comparison, but if it were placed in a smaller bank, such as the famous Barings Bank, this much money would be enough for them to go bankrupt.
Michio Matsumoto asked even more sensitively: "Are you sure it exceeds 5 billion US dollars?"
"yes."
"Will it exceed US$6 billion?"
"Thiscan't be sure."
"Go and make sure." Michio Matsumoto was sick and rushed to the doctor.
The secretary was dumbfounded and stood still. How to confirm this? When closing huge long positions, God knows what will happen.
Michio Matsumoto also quickly woke up, turned around and said, "Tell Tanabe and let him prepare to close the position."
Although his previous plan could not be realized, he did not want to become a "famous person".
6 billion US dollars will be on the list of huge losses for Japanese financial companies.
The secretary did not fully understand, and reminded him self-righteously: "Should we notify other trading companies?"
Matsumoto Mao suddenly stood up and yelled: "Shut up. Go and inform Tanabe, don't tell anyone."
When it¡¯s time to escape, you can¡¯t take care of your allies.
The friendship between companies cannot be measured in billions of dollars.
¡(To be continued. Please search Piaotian Literature, the novels will be better and updated faster!) - Didn't finish reading? Add this book to your favoritesI'm a member and bookmarked this chapterCopy the address of this book and recommend it to your friends for pointsChapter error? Click here to report
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