Violators Club

Chapter 759 Remaining life after catastrophe
Chapter 758 Survival

Leverage is a financial instrument.

If you have no money but are optimistic about a project, you can use this tool to amplify the investment effect.

For example, Clemens has 300 million US dollars in his hand, and the profit of this project he is optimistic about is 10%, and the final income is 30 US dollars, but Clemens is not satisfied with this effect, he wants to earn more money.

In the case of using five times leverage, he will have 500 million capital activities, and a 10% profit is 150 million.

Of course, the more you earn, the more you lose.

Turn a 10% profit into a -10% profit.

The final asset of the former is 270 million, and the final asset of the latter is 150 million, which is a full loss of 120 million.

Shorting is also a financial method, but the difference is that shorting refers to the expectation that the market will fall in the future, selling the standard contract in hand at the price, and buying it after the market falls, and making a profit from the difference.

It can be simply understood as the above-mentioned 10% profit.

It’s just that this profit has a bit of a gambling nature, because the world is full of various variables, and the short bet is the market decline, and in the financial industry, the wonderful combination of short + leverage.

It is often a classic example of getting rich overnight with a small fortune.

Of course, everything in this world is relative.

Some people are not optimistic about the euro, and some people will naturally support it, not to mention that the euro is a currency with unique significance. Under the bombardment of good news, many retail investors have been fooled and lost their minds.

But there are still smart people in this world after all.

On January [-]th, in an office building in Frankfurt, all kinds of rubbish were scattered on the ground, most of the four walls were peeled off, mottled moldy spots exuded a strange smell, and there were many temporary tidying up in the corners Rubbish.

And in the middle of the room, there are two improvised computers. Although the surrounding environment is very simple, but for Clemens and Sabastian in the early days of their business?

That's enough!

On the computer screen, with a black bottom frame, a red line fluctuates up and down like a heartbeat diagram.

Sebastian is operating the mouse with his left hand, a cigarette in his right hand, and a piece of sausage pizza in his mouth. It can be seen that he is very busy at the moment.

The current exchange rate of the euro is 1.05, which has dropped by 1.17% compared to 12 on the first day.

Calculated according to the country's GDP, it is equivalent to evaporating nearly 8000 billion euros of wealth in four days.

Of course, the actual situation is definitely not like this. The European financial industry has always been very prosperous. Moreover, the European Union is currently composed of [-] countries, which has unique advantages in fighting risks.

But even so, for retail investors of financial investment, a 12% decline is not good news.

Sebastian is very busy. With the help of leverage, the 300 million US dollars has become 500 million US dollars.

According to the current exchange rate, the money was exchanged for 420 million euros.

The euro's downward trend is clear, at least in the eyes of Clemens next to him.

The operations of the two are planned, and short selling is the last resort. What we need to do now is to maximize the wealth in our hands.

The exchange rate of 1.05 is not low, and the euro even reached 1.02 when it was the lowest yesterday.

But today's situation is different, starting at nine o'clock in the morning.

As soon as the euro came up, the exchange rate reached 1.04, and then did not give retail investors a chance to react, soaring directly to 1.07. Although there were fluctuations afterwards, the lowest was 1.06. Obviously, this is the beginning of the EU's efforts.

Clemens sees the ups and downs of financial exchange rates clearly.

Immediately overturned yesterday's plan, saying that at the price of 1.05, all the US dollars in his hand would be exchanged for euros.

Professional things are entrusted to professional people.
Sebastian still trusts Clemens' ability, but it is impossible to ask him to listen to the other party. After all, he himself has been a practitioner for many years, so when Clemens said he would do something, He couldn't help asking:

"Are you sure? It's not even noon yet."

Clemens shook his head, he explained while operating:

"Don't ink, hurry up and do it with me. Normally, noon is the time of the sharpest decline, but don't forget that today is Friday, and the European Bank will never let the dollar take advantage of the loopholes at this time. This is definitely the last low .”

Sebastian was skeptical, in fact, he was more inclined to think that noon was the lowest point.

But Clemens is more capable than himself, and he still has 500 million of the 600 million, so after a moment of thinking, Sebastian followed.

Facts have proved that his decision is very wise.

Because at noon on the [-]th, the euro, which has been sluggish for a long time, turned out to be uncharacteristically strong.

In just two hours, the exchange rate soared from the lowest point of 1.05 to 1.15.

In the afternoon, I watched the situation intensify.

The battle was so intense that both sides were clearly on fire.As if two giants were fighting, not only Europe and Eagle Sauce, but the entire world's finances would be affected, which made Sebastian's expression a little emotional.

For a long time to come, the financial industry will inevitably fall into a cold winter due to this impact.

But then he became happier. The more aggressively he fights now, the more opportunities he can make for money. As the European Bank continues to make efforts, when the euro exchange rate breaks through to 1.17?
The two resolutely chose to sell, and successfully completed this short sale with the existing 1428 million euros in their hands.

As for the rest?
Theoretically, the two of them could still continue to mingle in the monetary and financial district for two or three hours.

But when you think about it, it doesn't make much sense.

Things have developed to this point, the funds invested by both parties, plus a large number of locked-up retail investors.

All the funds add up to at least two trillion U.S. dollars. Even if the richest man in the world comes to a battlefield of this level, it may not be able to control the outcome of the battle.

The bets that should be placed have already been placed, and the rest is to look at their own fortunes. If you want to play two games, you might as well think about how much money you can make this time.

The first is the problem of funds. I have 180 million, and Clemens paid 120 million, which adds up to 300 million US dollars.

In the case of five times leverage, the funds in the hands of the two are equivalent to 1500 million US dollars.

The first transaction was at the exchange rate of 1.05.

At that time, the 1500 million U.S. dollars in hand was converted into a total of 1428 million euros.

In the next two hours, exactly as Clemens predicted, the European Bank, which had accumulated strength for two days, finally sounded the horn of counterattack at noon today, and the exchange rate of the euro has been rising all the way since then.

Near noon, it rushed to 1.17.

It was at this time that the two chose to make a move.

What Sebastian is counting now is actually the proceeds of the two shorting.

If the exchange rate between the U.S. dollar and the euro is really the same as Clemens guessed.

Originally, 1428 million euros was equivalent to 1670 million U.S. dollars, but now it is only equivalent to 1428 million U.S. dollars. The extra 242 million U.S. dollars is the short-selling income.

In addition, the first transaction was purchased at a low level of 1.05, and the second transaction was sold at a high level of 1.17. Excluding the five-fold leverage of 1200 million US dollars, plus 300 million principal, it is 470 million US dollars.

470+242?

"Damn! We actually made 712 million in this sum?!"

Sebastian exclaimed, he knew that every time a big event happens, it will be accompanied by a big opportunity.

But how much money can you earn?

In fact, he had no idea. After all, the financial crisis in 90 had nothing to do with him. When his elder brother disintegrated in the early [-]s, he was only a novice who had been in the industry for three to five years, which led to it.

Although he knew that big events would make money very quickly, he didn't have a clear concept from the beginning to the end.

And now after calculating the income?

The whole person was stunned, you must know that this is more than 700 million euros!
But compared to the excited Sebastian, Clemens, who was staring at the screen next to him, had a serious expression:
"Don't be too happy."

After the words fell, Sebastian's expression froze suddenly, and he quickly looked at the other party:
"No, don't you scare me?"

Clemens shook his head. He glanced at the time on his watch, and there was only an hour and a half left before closing.

This made his expression solemn, and he couldn't help but feel a little more uneasy: "There is still an hour and a half, no, this is not normal, how can the exchange rate stabilize at this time, damn it, this is not normal, how could it be like this!!"

(End of this chapter)