Dong Qiangqiang's Story of Leaving Germany

Chapter 581 581. Investment Company
"In the final analysis, information asymmetry allows investors to make different choices, and even in the face of stocks that have fallen due to scandals, blind shorting will still face many uncertainties, and this also brings investment risks." Dong Qiangqiang concluded.

"Because some problems may be misunderstood by investors, some problems may be accepted by the US Securities Regulatory Commission after the listed company explains them, or some problems are still not accepted by the management agency after being explained, and the stock price will fluctuate at this time. In fact, Similar cases have occurred many times in the history of US stocks.”

"Then how do you judge that Munich Re's stock price will not rebound?" Dong Qiangqiang asked, "Enron concealed huge losses due to fraud and fraud, and Munich Re's revenue dropped sharply because of the sky-high compensation brought by terrorist attacks. Both It’s all reduced revenue, why would you choose to buy puts on Munich Re instead of shorting it outright?”

"First of all, I want to confess that I have a gambler's mentality." Duanmu admitted generously, "It's just a matter of probability whether the stock price rebounds after falling or not. On the one hand, the short-term psychological impact of terrorist attacks is really It’s too shocking, and as more and more people are injured, its impact on Munich Re will also ferment over time. On the other hand, because of the existence of short-selling institutions, its stock price will fluctuate. It is because of the uncertainty about the short-term stock price that I choose to buy the 3-month put option. I believe that no matter how it rebounds, the stock price will not be able to return to the level before 911. This is your first question. The second point , Enron's fraud has been suspected for more than a year, and the bad influence has attracted the attention of the US Securities Regulatory Commission. It is hard to say whether it will be forced to delist. Once it is really delisted or forced to suspend trading and lose its stock price, short selling orders will be involved And the trouble that the put option cannot be exercised. Another point is that as an individual, you cannot borrow stocks from a third-party platform for short selling.”

It was the first time for Dong Qiangqiang to hear these short-selling knowledge, and he felt like a lucky kid who accidentally picked up a martial arts secret book after falling off a cliff, and he seemed to understand the secret book while holding it.

"Another thing you can think about is that if the first person to stand up and suspect Enron's fraud would first borrow a large amount of Enron's stock through a stock lending platform before publicizing his suspicion in the market, and then spread the word about Enron's tricks , what will happen?" Duanmu enlightened.

"I remember that someone questioned Enron at the beginning of this year, and the current stock price is less than a quarter of what it was at the beginning of the year." Dong Qiangqiang said, "If you dared to short Enron at the beginning of the year, you must have made a lot of money now. But with his How dare you doubt Enron? At that time, Enron was in full swing, and no one would suspect that the Fortune 500 companies would cheat.”

"So I have been thinking about this matter. Through research, I think this person must do at least three things well. First, he must have spent a long time researching all the information related to Enron that can be found in the market. Not only It is to visit the listed company on the spot, and communicate with its upstream and downstream companies and major customers. The second thing is more difficult. I highly doubt that he has communicated with insiders, which may be insiders of the audit company or Enron. An insider may also be a former Enron employee. Only through the research of these two aspects, coupled with his understanding of the company, can he come to his own judgment. The two aspects are indispensable, and neither is rigorous.”

Dong Qiangqiang tasted Duanmu's words carefully several times, and then engraved them in his mind. "But the behind-the-scenes factor that caused Enron's stock price to fluctuate today is its own third-quarter financial report. I know that listed companies must regularly disclose quarterly financial reports, but if they do not disclose them on time, their sharp decline should be delayed for a while."

"On the surface, the straw that seems to overwhelm Enron is its third-quarter financial report, but if it does not disclose it on time, the market will probably panic even more. Now it is really riding a tiger. If it does not disclose it, it will die anyway. It's just a matter of time. "

"The executives of these listed companies are all worth tens of millions or even more than [-] million US dollars. Why bother to do this? If you have a life to earn money, you have to have a life to spend it." Dong Qiangqiang said with emotion.

"Some people advocate seeking wealth and wealth through insurance. Horses have no night grass and no fat. How can making money slowly through formal channels is faster than cheating?" Duanmu replied with a smile, "Besides, these people may have transferred their wealth to Other tax havens or offshore financial centers, the US judiciary has nothing to do with them. They can declare legal bankruptcy, and they can be released on bail without even going to jail or sitting in jail for a long time, and then they can transform into Java and enjoy themselves. All wealth and happiness gone."

"They have no worries about food and clothing, but what about the investors who bought their company's stocks?" Dong Qiangqiang only felt that there was no end to one problem after another.

"No way, cold salad." Duanmu said bluntly, "If you buy the stock of this kind of company, you can only admit that you are unlucky. There are many law firms in the United States that litigate for this type of investors, and they specialize in seeking justice for them. Of course, the lawyers are not profitable, and they all want to get a share of the huge claims."

Dong Qiangqiang had already read part of what Duanmu said from the materials he gave himself, but now he heard Duanmu say it again, and he still felt shocked.Especially when I heard that many investors directly returned to poverty due to stocks, I didn't know how to evaluate it for a while.

Seeing that Dong Qiangqiang finally stopped asking questions, Duanmu changed the topic: "I have a plan to talk to you about."

"Which plan?" Dong Qiangqiang thought he had discovered some stocks worth investing in.

"I want to start an investment company," Duanmu said mysteriously, "the kind that can trade stocks, options, and turbines."

"Didn't you just become a regular?" Dong Qiangqiang said in surprise, "Are you going to fly solo?"

"No, I'm still in the current company, just starting a company."

"But it seems not cheap to open this kind of investment company." Dong Qiangqiang recalled, "For example, I only need 5 marks for the registered capital of a trading company, but different types of investment companies seem to require a lot of registered capital. And when opening a company in Germany It is required that the registered capital must be paid in place, that is, the money for the registered capital must be placed in the designated company bank account.”

"You're right. I've checked the official website of the German BaFin and I've also asked the agency that started the company. They said the same thing. If it's the kind that wants to use customer funds or its own funds for secondary market transactions For an investment company, the registered capital must be at least 25 marks."

Dong Qiangqiang misunderstood his meaning: "Do you want to borrow money?"

"No, I have the money. As soon as my Munich Re put option expires, I can register immediately." Duanmu's tone sounded very relaxed.

Dong Qiangqiang thought to himself, it seems that this kid has made a lot of money on the put option of Mu Re, and immediately congratulated him: "Yes, it seems that you are already a rich man, you have to hire someone big."

"Listen to me." Duanmu suddenly became serious, "Although I am not short of money, I cannot start this investment company in my own name, and my name cannot appear among the company's shareholders."

"Why is that?" Dong Qiangqiang was at a loss.

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