The Son of Finance of the Great Age

  Chapter 697 The first hedge fund (3)

   "There has been another large amount of selling, are these people crazy?"

  Jiang Shan looked at the data on the disk and couldn't believe his eyes. Treasury bonds at the level of 50 million US dollars were thrown out one after another, and there were even super selling orders worth hundreds of millions of dollars.

  Although bond analysts are unanimously determined that at some point in the future, the yield on the US 10-year Treasury bond will rise to a "normal level", that is, the price of the current Treasury bond will fall.

  Jiangshan is well aware of the recent operation of Tianyu Fund, which entered the bond market with US$10 billion. Although the yield has been raised by dozens of basis points, this amount of funds can only be regarded as a drizzle for the entire ten-year treasury bond market. For example, sovereign funds, government funds, and even super bond funds abound, and each of them may be more powerful than Tianyu Fund. Therefore, in terms of the current situation, Tianyu Fund is still under considerable pressure.

   "What's going on, how come there are so many selling?"

Zhong Shi stared at the market intently for a while, calculated the amount of selling in his mind, and came up with a figure that surprised him. In the past five minutes, a total of 500 million U.S. dollars has been sold in the market for ten years. Treasury bonds, this figure far exceeds the daily transaction quota.

   Regarding this situation, Zhong Shi was also puzzled, unable to make a decision on the next step.

"what should we do?"

Seeing Zhong Shi's indecision, Jiang Shan became a little impatient, and he could not help but add some complaints, "According to the previous judgment, it is very likely that the institution sees an unusual drop in yields and a rise in bond prices, and uses selling to retain floating funds. This part should be dominated by speculative institutions, which is also in line with the characteristics of large fluctuations in the short term. But another point cannot be ruled out. Some investors sold treasury bonds by short selling, thereby forcing the US Treasury yields rose to 'normal' range."

   Like any other investment, the market for 10-year Treasury notes is full of speculators and investors. The so-called investors generally refer to those hedging institutions. The most important purpose of their investment in government bonds is not high returns, but to obtain certain returns through this asset allocation to achieve value-added purposes. Generally speaking, such investors are mainly sovereign funds, the Ministry of Finance or some hot money.

  The other so-called speculators are mainly bond funds and the proprietary trading departments of major investment banks. These institutions are the main force of bond transactions in the market. They frequently sell back and forth every day, and use the accumulated transaction volume to earn small fluctuating profits. Don't underestimate the fluctuations of a dozen or even a few basis points. In the face of huge amounts of funds, the amount represented by these basis points is magnified hundreds or thousands of times, and one basis point even sometimes represents a change of millions of dollars.

  The result of these institutions’ games in the market is the yield of long-term government bonds, which in turn represents the long-term interest rate to a large extent and is an important reference data in the national economy. And this process is called interest rate marketization.

   Of course, for investors and speculators, there is no so-called strict boundary. For investors, if they sell a part of bonds in a timely manner, their role in the market becomes a speculator. For speculators, if they hold it for a long time, or even redeem it at maturity, it is not much different from investors.

  In general, the internal factors driving the transaction between the two can be expressed in one word: Profit!

   "The quota is not very large, let's talk about it later!"

  After thinking about it for a while, Zhong Shi finally decided to put the bargaining chip for this stock sale first. The selling price of 500 million US dollars is not too big, and Tianyu Fund can easily eat it. What he is worried about is that if no one follows this wave of selling, it will cause a chain reaction in the bond market, and more selling will follow one after another.

  Following Zhong Shi’s order, the traders started to get busy, and the buying side continued to appear. Half an hour later, this part of the selling order was wiped out.

  What Zhong Shi didn’t know was that when the Tianyu Fund swallowed up these sales orders like the autumn wind sweeping away fallen leaves, the reactions from the east and west coasts of the United States were jubilant.

   "Did they make a move?"

  Gross was looking at the analysis report in front of the computer, when he heard a noise in the trading room. Although these voices were weak and deep, it was quite unbearable for Gross, who was used to a quiet environment.

   Just when he was about to get angry, he suddenly realized that something unexpected might happen. He rolled his eyes and thought of the biggest possibility. Tianyu Fund made another move.

   "Someone made a move in the market, but I'm not sure if it's Tianyu Fund. We need to confirm it!" A trader replied with a serious face. However, his eyes burst into strange colors, and the corners of his mouth were slightly raised, obviously in a good mood.

   The inquiry process didn't last long, because the traders who traded with Tianyu Fund quickly fed back the news, passing it on to the second, and then to the third, and soon everyone knew the news. When the traders of Pacific Investment Management got the news, the trading room couldn't control it anymore, and cheers erupted from the audience.

   A total of 500 million US dollars of selling attempts, even if all came from Pacific Investment Management Corporation, is only a small number. But behind the whole incident, one thing has been confirmed, that is, behind the recent sharp drop in the yield of government bonds, Tianyu Fund is indeed selling.

   "Soros did not lie!"

   Gross, who got the news, pondered for a moment, and then said leisurely, "Even this kind of news can be obtained, it seems that he is indeed a stalwart, but I don't know who else participated in this sniping?"

"The whole thing was planned by Soros. He probably knows who is involved, but the list is probably out of his control. I think there must be other unknown funds involved." Elian Mu Hammoud said.

  Erian Muhammad is of Middle Eastern origin, as can be seen from his surname. This person has a typical Arab face: thick eyebrows, big eyes, high nose bridge, and thin lips. Overall, he is quite different from the white people around him. Within Pacific Investment Management Corporation, he is the CEO of the entire company, the nominal top leader.

   But for investment companies, it is obviously not the so-called "CEO" who has the most say, because investment performance determines everything. Gross is still the person with the most say in the company, and Elian Muhammad is considered to be Gross's "successor".

   This time, Gross included Elian in the hunt for the Tianyu Fund. Naturally, the purpose was to let him take a good look at how a giant with an exposed position was destroyed.

   "Yes, all we have to do now is to wait, and when the people in front have consumed almost the same amount of funds from the Tianyu Fund, we will defeat the opponent in one fell swoop!"

   Gross said confidently.

  Although Elian felt a little inappropriate, this is indeed a relatively safe way. He nodded immediately and didn't say anything else.

  Almost at the same time, inside the Quantum Fund, the cheers of the traders also erupted after the test position in the market was swallowed up, and it didn't take long for them to learn about the Tianyu Fund's move.

"It seems that they are indeed eating ten-year treasury bonds!" Rodney Jones couldn't help shaking his head. He knew very well in his heart that once the news of this position exposure spread, all that remained was to deal with the endless attacks in the market. . And so far, no fund has been able to retreat under such an offensive.

The end of Tianyu Fund seems to be doomed. Rodney Jones is very complicated. On the one hand, he feels that the mistake Zhong Shi made this time is really too big. On the other hand, he is also vaguely looking forward to the big scene in the future , after all, not everyone can see or participate in such events.

   "Don't worry, let the small funds consume their funds first!"

   In the subsequent strategies, Soros and Gross maintained a surprising consistency, but the difference is that Gross's calculation is to drive sheep to feed tigers, while Soros is to drive away wolves.

"here we go!"

   Just as Soros finished speaking, there was a change on the board, and Rodney Jones couldn't help exclaiming.

After Tianyu Fund took the test position, the market once returned to a calm trading state, but this state was soon broken, and then selling orders worth several million dollars and tens of millions of dollars sprung up one after another like mushrooms after rain. Come out, although the amount of each transaction is not large, but the aggregated amount is also considerable, and soon the accumulated scale is close to hundreds of millions of dollars.

   "Buy it, buy it, and see when he can wake up!"

  Soros felt a sense of gloom in his heart, staring at the board and thinking viciously that he was already obsessed with Zhongshi's battered appearance.

  As a matter of fact, Zhong Shi is indeed a bit confused about the situation on the board now. Logically speaking, the selling orders just now were forcefully swept away, indicating that the main force of the bulls is exerting their strength, and the bears should at least avoid the edge a little, not to mention a fight to the death. But in fact, the small short sellers kept pouring out like moths to a flame, which made him a little confused.

   “Yields are up three basis points and going up!”

  Jiangshan also couldn't see the situation clearly, but he wasn't worried. The current market was just a little more selling orders than usual. For Tianyu Fund, this level of transactions is just a drizzle.

   "This should be the way some institutions see an opportunity and choose to sell for arbitrage!"

Seeing that Zhong Shi was thinking, Jiang Shan also took the initiative to explain, "Looking at the transaction amount, it is only a few hundred million U.S. dollars. This figure is only a little higher than usual. Some news may have affected their judgment. Or A certain investment bank's self-operated department is releasing a large amount of goods, no matter what, this amount is unlikely to pose a threat to us!"

  Zhong Shi also nodded when he heard the words. This is indeed the case. He waved his hand and signaled that Jiang Shan would take over the next transaction.

   "Okay!"

  Jiangshan was overjoyed when he heard the words, and waved his hands at the traders boldly, "Brothers, eat all of them! Suppress the yield rate for me!"

  The trading room applauded!

   Soon, these sales orders were digested by Tianyu Fund again. In order not to attract too much attention, Jiang Shan quietly released some of his positions in order to confuse the market's attention. But how could he have imagined that Tianyu Fund's operations had long been targeted by interested people. This part of the position he released was quietly taken over by Pacific Investment Management Corporation.

  After one day of operation, Tianyu Fund absorbed a total of 920 million US dollars in 10-year government bonds, and kept the yield steadily at 3.5%. On this day, a total of 1.7 billion US dollars of 10-year treasury bonds were sold in the market, and the Tianyu Fund accounted for more than half of the shares.

The next day, December 29th, when the 10-year treasury bond market opened, Jiangshan immediately felt the difference in the market, both in terms of the number and strength of the market, which far exceeded the previous day. unusual.

  However, because on the one hand, the amount available for operation did not exceed his authority, and on the other hand, Jiang Shan did not notify Zhong Shi in time because of his confidence in his trading skills. After a fierce struggle with selling orders, Tianyu Fund absorbed 1.9 billion US dollars of 10-year treasury bonds on this day, accounting for 40% of the entire market's buying quota.

   In terms of yields, the yield on the 10-year treasury rose 15 basis points to 3.65% due to the fierce selling momentum.

   Thank you very much for your monthly votes from Little Pig, Kalm God, Xiao Yao, Tiandi Shenfeng, Suzhou Wudajiang, Weimi, etc.! I didn’t write it because it was too late yesterday. I hope everyone will forgive me... I will work harder on the last day. Thank you for your strong support this month. I received more monthly tickets this month than before. The author is grateful. Next time Keep up the good work!

  (end of this chapter)