“We have been investing in Gold futures, and we will have hedging positions to lower the risks. In August, the gold prices had dropped a lot, but we are able to react in time and shorted Gold. We were able to get some profits. We had discussed Gold prices and felt that gold prices will continue to rise this year. It should be able to reach about 380 USD.”
He Zhaoji and Fu Rongqi had the same views on Gold. Although their analysis was quite conservative, in the short term, gold prices will inevitably rise. Both did not know that gold prices will rise higher than 380 USD and even reach 390 USD.
But this was enough to prove these people’s abilities. Feng Yu does not need a broker who likes to take risks. He wants someone who was experienced, have good judgments and was able to follow instructions. If the broker could not follow directions, Feng Yu would not want him even if he was capable.
In Feng Yu’s mind, he had the memories of his previous life. He remembered the trends of the financial instruments. In his past life, he had studied the historical trends countless times, and everything was in the back of his mind.
Feng Yu was confident that in this era, George Soros and Warren Buffett were no match to him when it comes to investment. He was the real Financial magnate in this era!
“How much funds do we have to invest in Gold Futures?”
“Including you and our brokers’ own accounts, and some customers who agreed to invest in Gold Futures, we have about 500 million HKD.”
Boss was really going to place a big bet. He was going to use all available funds?
But soon, He Zhaoji realized that this 500 million HKD was only a small amount to Feng Yu. Because there was be a significant fund coming in later.
“Only 500 million? Fine. Take note of the company’s account. Later there will be some funds wired to our company. When all the funds are in, we will start to trade Gold Futures.”
Not every customer dares to let their brokers invest in futures. Most of the customers had only signed the agreement to allow their brokers invest in the stock markets on their behalf. If their funds were used to invest in futures by the brokers, it would be against the law and will affect the company’s reputation.
500 million HKD of funds was not a lot. Luckily Feng Yu had prepared some money. It was rare for him to invest in futures personally and he wants to gain the most profits out of this.
“Boss, China’s Tai Hua Trading had transferred 300 million RMB!” After a while, He Zhaoji saw the money credited into the company’s account and immediately reported to Feng Yu.
Feng Yu calmly nodded: “Ok. Ask someone to go downstairs to buy a cup of milk tea. Your tea leaves do not taste good.”
10 minutes later, He Zhaoji entered the office with a cup of milk tea: “Boss, China’s Wind, and Rain Electronics had wired 100 million RMB to our account!”
“Ok. Leave the milk tea here.” Feng Yu was holding on to a novel . His eyes were glued to the novel. If this novel were written in simplified Chinese and not traditional Chinese, it would be great. Reading traditional Chinese was too complicated and tiring.
This series of novels was not available in Bing City. After Feng Yu arrived in Hong Kong, he bought the whole set and read it whenever he was free.
15 minutes later, He Zhaoji entered the office again and took a deep breath: “Boss, Japan’s Aiwa company had transferred 30 million USD to your account!”
“Ok.” Feng Yu replied without even taking his eyes off the novel. He made a sip of his tea and did not give any other instructions.
He Zhaoji looked at Feng Yu. The total amount of the funds that were transferred over was more than 500 million HKD, and Feng Yu was still waiting. More funds were coming in?
5 minutes later, He Zhaoji came into the office to report to Feng Yu: “Boss, a Sixth Sense Company from Japan, had just transferred 50 million USD into your account!”
He Zhaoji was looking at Feng Yu weirdly. It was not because another large amount was transferred into his account. It was because he had heard of the Sixth Sense Company. It was a company that sells those “products.” Could that company also belongs to Feng Yu?
Feng Yu placed a bookmark into his novel and put it down. He did not notice the look in He Zhaoji. If not, he would have lost his temper. What’s wrong with owning a sex toys company? Why can’t an ordinary person own such company?
Feng Yu looked at his watch. There was still enough time: “Ok. Get ready to place the orders. What is the Gold prices now?”
There was internet now, and they do not need to be at the exchange personally. They could place the orders through the internet. But the orders still require confirmation from the exchange. It was still not as convenient as the future years.
He Zhaoji saw in front of a computer and turned to Feng Yu: “Boss, current the price is at 259.8 USD / ounce.”
“All our customers’ funds will use 10 times leverage and set it to sell at 280 USD automatically.” Feng Yu said.
“All? Boss, we are not hedging?” Feng Yu plans to use his own funds to short? But Feng Yu had agreed with his analysis and also thinks that gold prices will rise before the end of the year.
“Everything! This time we will not do hedging. We will bet on the price to rise!”
What? Not hedging?! Feng Yu wanted to bet more than 1 billion HKD on gold prices rising and not hedging? This was 10 times leverage. If the prices fell by 1 USD, the losses will be 10 USD! Didn’t Feng Yu tell them to invest conservatively all this while? What was he so aggressive this time?
“What are you waiting for? Hurry up and place the orders! Tell the rest to use their customers’ accounts to place the orders.”
He Zhaoji walked to the entrance of the office and clapped a few times to attract everyone’s attention: “Boss asked us to buy gold at the current price with the funds we have. Everything will be using 10 times leverage. The sell-off price is at 280 USD.”
The rest of the brokers were shocked like He Zhaoji. 280 USD? Did their boss firmly believe that gold prices will rise above 280 USD? But the leverage will be set at 10 times, and they will be investing everything. This was quite risky.
But when all the brokers thought about their boss miraculous predictions, they chose to believe their boss. Furthermore, their boss was the one who performed the legendary feat of short selling oil with high leverage during the Gulf War!
After all the brokers placed their orders, He Zhaoji returned back to his office to help his customers place their orders.
“Wait a minute. Set the selling price at 281 or 282 USD for your customers.” He Zhaoji was the company’s general manager. Feng Yu want to help him establish his standing. Also, Feng Yu also want to see if He Zhaoji dares to place such orders.
“Boss, is this too high?”
“High? I do not think so. I plan to set the selling price for my own money from 285 to 288 USD. You can start to place your orders.”
He Zhaoji’s eyes opened wide. Feng Yu felt that the gold prices will reach 285 USD? Was this even possible?
The gold prices had just rebounded from the previous drop. Feng Yu felt the gold prices will be following a V curve? That means Feng Yu felt that there will be an increase in people investing in gold, causing the prices to rise?
He Zhaoji gritted his teeth. Feng Yu was investing more than 1 billion HKD, and that means he was very confident. Feng Yu had better foresight then him, and he had complete trust in him. Since Feng Yu was convinced that gold prices will rise, then it will undoubtedly increase.
He Zhaoji placed the orders for his customers and set the selling price at 282 USD. He also used all his money in his account to place the order. He was also using 10 times leverage, and he set his selling price at 285 USD!
He Zhaoji did not hedge against this trade and had used all his money. If gold prices really reach 285 USD, his investment will be doubled! He will then invest all his money into the US stock market. If he monitors the market closely, he could be a millionaire in less than 2 years!
Translator’s notes:
George Soros
https://en.wikipedia.org/wiki/George_Soros
Warren Buffett
https://en.wikipedia.org/wiki/Warren_Buffett