Reborn as a female internet celebrity in a county town

Chapter 370 Mr. Yan, you've gone astray by hanging out with Lin Lang.
Lin Lang chose today because the time had come.

The euro has reached an exchange rate of 1.0886 against the dollar.
The European foreign exchange market opens earlier, and exchange rates have already started to change.

After 3 p.m., Lin Lang went to the trading room.

During this period, Yan Li helped contact more than a dozen forex brokers, including those in the United States and those in Europe.

Starting at 5 p.m., Lin Lang began to work with brokers in Europe to secure contracts.

Essentially, Lin Lang was going long on the euro, and he wanted brokers to help him connect those who were shorting the euro.

Many people are bearish on the euro, such as companies in the US that do business with Europe. They trade based on yesterday's or today's exchange rate, but the payment for those goods may not arrive for a month, three months, or even half a year.

If the euro depreciates, they will lose money on this deal. After all, they can get $10880 for 10,000 euros today, but if the euro-dollar exchange rate becomes 1.0760 a few months later, they can only get $10760 back from the U.S. Bureau of Foreign Exchange after receiving the 10,000 euros payment.

A business deal worth a mere 10,000 euros will result in a loss of 1.2 million US dollars. What if it were a business deal worth 100 million euros? The loss would be 1.2 million US dollars. And what if it were a business deal worth 1 billion euros? The loss would be 10 to 2 million US dollars.

Both parties conduct a large amount of business every year, so you can imagine how big the demand is.

The risk is even greater for transactions with long payment terms. Over a few months, the currency may depreciate by several percentage points, and the resulting exchange rate losses could wipe out the profits, essentially making the business a waste of time.

In any case, legitimate companies that don't use leverage have very low transaction fees.

Besides the various foreign exchange contracts needed in Europe and the United States, other countries also need to conduct various transits.

This is one of the reasons why the global foreign exchange market can have such a large trading volume every day.

Of course, there are also many speculators here.

Speculators used various forms of leverage to amplify trading volume.

Lin Lang actually had two choices: either to enter the market quietly and gradually, or to go all out and aggressively buy up all the relevant contracts.

The former will be slower, while the latter may attract attention and let others know that a big fish has entered the market.

In the euro and dollar markets, due to the huge trading volume, there are no absolute market makers.

Unlike the US dollar and RMB, which account for a relatively small portion of the foreign exchange market, the exchange rate can be affected in the short term if some people are willing to invest heavily.

To influence the exchange rate between the US dollar and the euro, you would need to spend far too much money.

But Lin Lang really couldn't guarantee that he wouldn't be targeted after making a splash.

Therefore, his initial plan was to enter the village quietly and not cause any trouble.

However, Lin Lang underestimated the activity level of the entire market.

"Are there any 100 standard hands available right now?"

"Yes, yes, yes!"

"What about a thousand standard hands?"

Yes, yes, yes, yes!

"What about 10,000 standard hands?"

Yes, yes, yes, yes, yes!

"What about 100,000 standard hands?"

"Yes, yes, yes, yes... If not, we can make one on the spot..."

At this point, Lin Lang realized just how much leverage these brokers were operating with.

Just like when the internet started selling lottery tickets, those internet companies obtained authorization from the lottery authorities to sell lottery tickets online.

As a result, they realized that they didn't need to print out a receipt for every lottery ticket they sold, because buying lottery tickets was bound to result in losses anyway, and even if they won a big prize, they could still redeem the winnings privately.

So they bypassed the lottery system and distributed lottery tickets to lottery players privately.

The final result was that buying lottery tickets online was forcibly stopped.

The same applies to the foreign exchange market.

In order to earn commissions and overnight interest, brokers will use all sorts of methods.

Anyway, it doesn't actually need to be exchanged for euros or dollars; it's just that the contracts are circulating indefinitely.

The fluctuations in exchange rates are governed by a deeper algorithm, and even if those contracts are related, their influence is negligible.

Especially those perpetual contracts circulating in the market, they are probably even more outrageous than options.

With that, Lin Lang was relieved.

The account margin is in place; let's start by taking a small portion of the profits.

Once the US market opens, the trading volume will increase significantly, becoming the most active time of the day, with 70% of the trading volume completed during that period.

Lin Lang's current funds will not have much impact on the exchange rate after they are put into the market. In fact, he tried to take 10,000 standard lots, which is worth one billion euros, and it had no effect.

Going long on the euro simply means buying euros, which only required a margin of about two and a half million US dollars.

He has reserved margin in each account so that if the market falls, those margins can prevent him from being liquidated.

Anyway, he'll only go in with 60% of his capital today at most, especially since he's realized his backup plan won't be needed...

His backup plan was that if there was a risk of margin call on this side, Tianjin Global Selection would immediately place large orders to try and boost the exchange rate.

However... it's no longer needed, because the impact is negligible.

When Lin Lang opened his position, the exchange rate was fluctuating, gradually moving from 1.0886 to 1.0885, 1.0884, and so on.

……

Inside the company, Yan Li didn't leave after get off work, since she knew what Lin Lang was doing.

In the office, she was also watching the exchange rate fluctuations. She knew that Lin Lang wanted to go long on the euro, but the euro exchange rate kept falling. She also thought that Lin Lang was going to use high leverage. Every fluctuation of the fourth digit after the decimal point represented a huge amplitude.

She could go to the trading room, but worried about disturbing Lin Lang, so she simply stayed in the office and waited for Lin Lang to come out.

Lin Lang had prepared quite a lot in advance; she had never seen him so serious before.

He didn't even show up when I shorted Apple three times; he just told me in a WeChat message what to do, and then my net worth increased by thirty points.

When he personally intervenes, he can almost always turn a losing situation around and bring about a breakthrough.

The explosive growth phase of Tianjin Global Selection's net asset value was not a few days ago, not when it was earning 30 points or 7 or 8 points a day, but when Lin Lang came to Shanghai before the Lunar New Year and made an options transaction, earning more than 10 points or even 20 points every day.

In total, over eight trading days, the net asset value of Tianjin Global Selection soared.

In the past, she wouldn't have been worried about Lin Lang.

Because Lin Lang had his own analysis, she believed that Lin Lang was definitely not wrong.

But this time, it's not enough to just analyze correctly to make money.

No matter how much you analyze it, it's impossible to accurately predict the four digits after the decimal point.

Ignoring the fourth decimal place, as long as the third digit fluctuates by even a few digits, the account will be liquidated.

If we calculate based on the exchange rate of 1.0886, a long position in the Euro would be wiped out if it fell from 1.0886 to 1.0858.

Of course, as long as Lin Lang doesn't use up all the deposit, he can mitigate the risk.

But... the fluctuation was too small. She didn't believe that anyone in the world could control such a minute fluctuation.

A daily exchange rate increase or decrease of 0.25% is a very common occurrence.

Even a 0.5% drop is common.

With high leverage, ability becomes less important and luck becomes the dominant factor.

Before we knew it, it was six o'clock in the afternoon, and the market in the United States had opened.

Yan Li noticed the exchange rate fluctuate sharply, dropping from 1.0884 to 1.0878.
This fluctuation made her heart race.

That feeling was unlike anything I'd ever experienced before, because once the margin call was triggered, it meant losing $1.5 billion.

Yes, Tianjin Capital is not short of $1.5 billion, but it's difficult to explain.

Suddenly, the phone rang.

She picked it up, glanced at it, and answered, "Director Guan, what's wrong?"

"Is Mr. Yan resting? I hope I haven't disturbed you?"

"Uh...no, is there something you need, Boss Guan?"

"Is Lin Lang in the trading room? Has the market opened?"

"Yes, it opened a long time ago. Lin Lang hasn't come out since 3 pm."

"Huh? Don't US stocks open at 9:30 or 10:00?"

Yan Li: "..."

She chose to remain silent about the matter.

Guan Sheng on the other end of the phone was silent for a moment, then suddenly asked, "Lin Lang wouldn't be going into the stock market, would he? Haha, definitely not, I'm overthinking it, hahaha..."

It was obvious that his laughter at the end was somewhat forced.

However, Yan Li still did not respond.

Guan Sheng continued, "Actually, I could just go to the office and see where the funds went, but we're on holiday now."

Yan Li's attention remained fixed on the computer screen.

She saw the exchange rate fluctuate again, falling to 1.0875.

Her heart clenched again.

"President Yan, President Yan, are you still there?"

"Yes, Mr. Guan, what can I do for you?"

"I just thought about it. The only markets that open at 3 PM are some European markets. European markets are either futures trading or foreign exchange trading. There's nothing interesting about the European stock market, and Lin Lang certainly wouldn't be interested in going there. What products does Lin Lang make?"

Foreign exchange.

"Haha, I knew that guy was daring. Last time he was talking to me about using 400x leverage. Who would dare to play that? Not many people do it. Being able to use 20x or 30x is already pretty impressive. But Lin Lang is different. I guess he used 50x leverage, right? I'm pretty good at judging people."

Yan Li: "..."

Guan Sheng, who was on the other end of the phone, didn't hear a reply, so he asked, "Mr. Yan, are you still there?"

"Yes, yes."

"I guessed it, didn't I? The risk of 50x leverage is already very high, but the profit is also very high. Even if you only capture 0.25% of the fluctuation, after deducting all kinds of fees, you can still make a 10% profit."

Yan Lin could tell that Guan Sheng was actually uneasy, which was why he called to chat.

"Uh-huh."

Yan Li didn't know how to reply, so she just left it at that, since the exchange rate was still falling.

……

Inside a small hotel in Shanghai.

Guan Sheng and Luo Ze booked a standard room and ordered a bunch of barbecue skewers. It was only 8 p.m. at this time.

At this moment, Guan Sheng's phone screen was placed on the bedside table between the two beds.

Guan Sheng pretended to be indifferent, mimicking a relaxed tone, but in reality, his facial expression had already stiffened.

Luo Ze turned off the microphone and immediately said, "Is that bastard Lin Lang out of his mind? Holy crap! Playing forex with 50x leverage? Is he trying to bankrupt us?"

"What are you yelling about? With the volatility of forex, can you even play without leverage? The more you lose, the more you win; profit and loss come from the same source. Besides, I know Lin Lang too well. He never fights a battle he can't win. Do you know how big 50x leverage is? It requires a 2% fluctuation to liquidate your account. Where is there such a large fluctuation?"

"No, what if we lose money?"

"As long as Lin Lang chooses the right direction, even if he loses money temporarily, he'll make it back sooner or later! Who in the world can be better at choosing a direction than Lin Lang? It's not like it's 80x or 100x leverage, what's the rush?"

"How do you know it's not 80x or 100x? Yan Li's response just now was very perfunctory. Who knows, Lin Lang might have directly used 100x leverage?"

"Do you think Lin Lang is stupid? He has risk management skills! Stop talking, I need to talk to Yan Li for a bit more..."

Guan Sheng turned on the microphone, adjusted his expression, and said in what he thought was a gentle and relaxed tone, "Is President Yan still here?"

"Uh, yes..."

Yan Li's voice still sounded somewhat absent-minded.

Guan Sheng said, "I just thought about it, and fifty times leverage is definitely too conservative for Lin Lang. After all, you can't find another person with his extremely strong trading ability. Did he use one hundred times leverage?"

Yan Li did not reply.

Guan Sheng was already rubbing his hands together.

He added, "Mr. Yan, we can understand the 100x leverage. Lin Lang seems to like pursuing the ultimate returns. Moreover, this fund has a great reputation and attracts a lot of attention. It's normal for him to want to achieve extremely high returns."

"President Yan, President Yan, are you still there?"

This time, Guan Sheng sensed something was wrong.

Because... Yan Li stopped replying.

At least they gave me a perfunctory response before.

The call hasn't ended yet.

He tentatively added, "Could it be that you've used 400x leverage? Mr. Yan, you've been with Lin Lang for so long, you're starting to scare me, aren't you? You young people just want to see us make fools of ourselves... 400x leverage already minimizes the role of ability; luck plays a much larger role. You certainly wouldn't leave the risk unmanaged. In my opinion, 100x leverage is already the limit..."

At this moment, Yan Li finally replied, "Leader Guan..."

Guan Sheng heard the tremor in Yan Li's voice.

"President Yan, what's wrong?"

"They might have been liquidated..."

"What? Margin call? No, how did you get liquidated? How can you get liquidated with 100x leverage? The normal exchange rate fluctuation is around 0.5%, which is far from a one-point fluctuation."

"Lin Lang has a leverage ratio of four hundred times."

(End of this chapter)