Hong Kong Island Chronicles: From Electrical Appliances King to Business Legend

Upon hearing that Li Jiagang wanted to make a recommendation, the agent quickly picked up a notebook and showed it to him.

"Of course there's an introduction. This information is compiled by me personally, showing the most recent investable projects. I'm just wondering, Mr. Li, are you planning to invest in high-return products or long-term, stable blue-chip stocks?"

"Oh! Could you explain in detail the differences and advantages of these two types of investments?"

"Okay, Mr. Li."

"The advantage of high-return products is that investments can open a 'margin' account, which means expanding funds for market entry through leverage. If the investment goes smoothly, high returns can be obtained in a short period of time."

The main investments are in promising overseas products, with the foreign exchange market performing particularly well recently. Additionally, futures markets such as gold and silver are also performing well, making them worthwhile investment options in the near term.

"Especially in the oil sector, after NYMEX launched heating oil futures earlier this year, the trading volume of energy futures increased significantly, and the spot price of crude oil also rose considerably. Moreover, the oil market has been performing very well recently, making it a worthwhile investment."

"While investing in Hong Kong blue-chip stocks is a stable investment, it requires a long-term commitment, and the rate of return depends on market changes and the real-time changes of the stock itself."

"Margin trading account?"

"Gold, silver, oil?"

When the broker reminded him of this, Li Jiagang immediately recalled that between 78 and 79, there seemed to be a period of great fluctuation in the international market for gold, silver, and oil products, which was indeed a good time to invest.

The reason for rising oil prices is the domestic oil war.

In late 1978, a revolutionary war broke out in Iran's major oil-producing countries, causing a temporary halt to Iranian oil supplies and triggering severe economic turmoil.

From the end of 1978 to the beginning of March 1979, Iran suspended oil exports for 60 days, resulting in a daily shortage of about 5 million barrels of oil in the oil market, accounting for about one-tenth of the world's total oil consumption, causing fluctuations in international oil prices and supply shortages.

The sudden decrease in crude oil supply in the oil market also triggered a buying frenzy in regions that have always relied on imported oil, causing oil prices to rise sharply.

Moreover, this oil crisis continued. Just as the internal revolution in Iran was being resolved and oil prices returned to normal, the Iran-Iraq War broke out.

The Iran-Iraq War led to a complete halt in oil supplies from the two major oil-producing countries. This also triggered numerous problems in the local oil-producing countries, resulting in chaos, a significant reduction in international oil supply, and a sharp rise in oil prices.

It's now the end of August 1978, and crude oil is indeed worth investing in to make some quick money.

As for the international gold market...

The reason is also related to the turmoil in oil-producing countries.

金价从78年初的40美刀/盎司开始就不断上涨，到了78年底12月，金价已经涨到接近200美刀/盎司。

Gold prices will cool down for a while during this period, but overall, gold prices are still rising steadily.

Starting in October 1979, international gold prices began to surge wildly, going crazy from $220 to nearly $500 per ounce by the end of December. And that wasn't all.

At the beginning of 1980, international gold prices rose sharply again, reaching an astonishing $850 per ounce by January.

This means that if Li Jiagang had started investing in gold at that time, by the time the market closed in early 1980, the price of gold would have appreciated by a full $750 per ounce, making it an extremely profitable investment.

He became more and more excited the more he thought about it.

The same applies to silver.

Silver prices experienced a major surge at the end of 1979, triggered by the Hunt brothers in the United States. These two brothers had been secretly acquiring large quantities of physical silver since the early 70s, accumulating a huge stockpile.

As this agent Wang said, gold, silver, and crude oil are all worth investing in nowadays.

"Brother Wang, you just said I can open a margin account, but how much leverage can I use?" Li Jiagang pressed.

Knowing that there are so many good opportunities to make money in the international market, Li Jiagang also wants to know how much leverage he can use to enter the market.

He probably wanted the highest possible leverage.

However, in that era, because electronic products were not yet used to manipulate the market, there was a significant information gap between stock markets in different regions. The use of leverage was strictly controlled, unlike the stock market in later generations where leverage of a hundred or more times could be easily applied.

When Broker Wang saw that Li Jiagang seemed interested in investing in futures or foreign exchange, he got excited too.

"Mr. Li, the leverage ratio has been approved. The company will conduct a comprehensive evaluation based on your qualifications."

"For example, if you, Mr. Li, own property, savings, or family assets, these can be used as conditions for the company to approve the use of higher leverage for you."

"Of course, the company will also assess the risks of the products you, Mr. Li, wish to invest in at that time, and then comprehensively approve the leverage ratio that can be approved."

Li Jiagang finally understood.

First: To leverage higher amounts, you need to conduct a personal financial assessment.

Second: We will also conduct a risk assessment based on the products the client wants to invest in before approving the leverage ratio.

Li Jiagang can understand these things.

Client financial assessment is an assessment conducted by investment companies to determine whether investors have sufficient repayment ability and risk tolerance.

The more assets you have, the higher the leverage will be.

Investment companies would love to give you the best leverage, since they make their money from commissions, interest, and various fees.

Regarding leverage usage, Li Jiagang believes that brokers would not deliberately reduce the leverage used by their clients.

"If I want to invest in the oil, gold, and silver products you just mentioned, with a principal investment of several million Hong Kong dollars, and my personal assets that I can prove include factories worth several million, how many times leverage can I use?" Li Jiagang asked again, wanting to understand clearly.

"A principal of tens of millions of Hong Kong dollars?"

"Does an individual also own a factory worth millions as proof of assets?"

"Mr. Li, do you have any personal debts?"

"No, I have no debt at all."

The agent was immediately excited upon hearing this.

For him, clients like Li Jiagang are definitely high-quality clients. They invest high amounts of capital, have proof of assets to bear the risks, and are also new to the business. He would do anything to find such clients.

"Mr. Li, based on the conditions you mentioned, I can assure you that the company can approve at least ten times leverage. Of course, the final leverage ratio will depend on my application to higher authorities."

Generally, brokers do not have the right to directly approve leveraged trading for clients, but they will use their experience to judge whether a client's conditions meet the requirements for leveraged trading.

That's why Manager Wang dared to give such a confident response.

"Only 10x leverage?"

Li Jiagang was not entirely satisfied.

Knowing full well that there are few major opportunities in the international futures market ahead, he naturally wants to enter the market with the highest possible leverage, as such opportunities are rare and hard to come by.

With tenfold leverage, even if he invests 100 million in principal, the amount he can leverage will only be 1 billion.

The international futures market is so big that, frankly, an investment of one billion Hong Kong dollars wouldn't make a ripple at all.

按照如今78年港币兑美刀1/5汇率来算，1个亿港币兑换成美刀也就2000万罢了，加上十倍槓桿扩大资金，也就是2亿美刀入市。

He was really unwilling to accept such a good opportunity with only ten times leverage.

But he couldn't say much now, since he wasn't going to invest in the international market immediately. He needed to invest in Wharf Holdings first to make a profit and expand his capital. He could then discuss leverage ratios later.

Having thought all this through, Li Jiagang didn't continue the discussion.

"Okay, I'll do my own research. I'll contact you once I've decided to invest in international futures products."

"Now I want to try my hand at the Hong Kong stock market, since this is my first time investing in stocks."

"Okay, do you need me to recommend a few good stocks for you, Mr. Li?" Broker Wang did not recommend international futures investment to Li Jiagang again.

Having been an agent for so long, he understands that pushing too hard before gaining a client's complete trust will only cause him to lose that client.

"Any recommendations?"

"If you, Mr. Li, are looking to invest in the short term, you can consider these stocks. Recently, there has been a lot of positive news about these stocks, and their upward trend is quite strong."

Looking at Li Jiagang's list: "Park Ballroom, Jianing Group, Meihan Real Estate, Xiangbin Electric."

When the name "Jianing Group" came into his view, Li Jiagang was momentarily stunned.

This is one of the two legendary stocks in Hong Kong.

The first is the stock of "Hong Kong Antenna" Company, which was listed before the stock market crash in 1973. It is known as the first legendary stock in Hong Kong. The company reached its peak immediately after listing, and its stock price was driven up to more than HK$50 per share in less than two months from the opening price of HK$1.

The second one is the stock "Jianing Group".

The legend of Jia Ning is just as powerful. In just over a year, Jia Ning's leader, Chen Qingsong, has made a series of crazy acquisitions through a series of shrewd moves.

In a short period of time, it transformed a listed group with assets worth one or two hundred million Hong Kong dollars into a diversified large enterprise group with a market value of over ten billion Hong Kong dollars.

However, the reason why these two companies are called mythical legends is that both of them created miracles through deception.

Therefore, they are known as the two legendary stocks.