Returning to his senior year of high school, he went all in and made billions by buying at the botto

Chapter 82 First Battle to Become a God

The second hour after the Swiss franc storm broke out.

Merrill Lynch's Asia Pacific headquarters in Central, Hong Kong, is brightly lit.

Foreign exchange traders, legal advisors, compliance officers, and risk managers who had already left work were urgently recalled to the company.

The office area was filled with the constant ringing of telephones.

On the huge chart, the euro/Swiss franc exchange rate remains in a state of extreme volatility.

Quotations are chaotic and spreads are out of control.

There can even be price differences of several percentage points between different liquidity channels.

"It's been confirmed in Europe that some forex brokers are already insolvent!"

"The London trading desk is re-verifying Swiss franc orders!"

"Customer negative balances are still expanding!"

"Suspend new orders for Swiss Franc currency pairs and immediately increase margin requirements for all related products!"

Commands were continuously issued.

The entire Merrill Lynch Asia Pacific foreign exchange division has entered the highest level of risk status.

However, amidst a sea of suffocating loss reports, a newly established institutional account stands out starkly.

Genesis investment.

This account not only avoided losses, but also bought a large number of Swiss franc directional positions weeks in advance.

Forward contracts, options, and short positions in EUR/CHF.

Moreover, immediately after the Swiss National Bank announced the removal of the exchange rate floor, Chuangsheng Investment quickly demanded the exercise, settlement, and phased liquidation of its positions.

The timing was so precise it was almost frightening.

Li Lin, Executive Director of Merrill Lynch Asia Pacific Private Wealth Management, stood in the conference room, looking at the account data on the screen with a complicated expression.

More than a dozen senior executives sat on either side of the conference table.

Several of them had just connected via video to the New York headquarters.

The white executive in charge of institutional risk spoke first: "Why would this client have such a concentrated exposure to Swiss francs?"

Li Lin replied in a deep voice, "The client submitted a European currency hedging portfolio, and all transactions have undergone compliance review. The account has sufficient margin and has not exceeded the internal risk limit."

"Who is in charge of this account?"

"Me and Lu Jingyi."

As soon as she finished speaking, many people in the meeting room turned their attention to Lu Jingyi, who was sitting at the end of the room.

A thick stack of documents lay in front of her.

Despite being scrutinized by the New York headquarters and the Asia-Pacific management team, she remained calm.

"The funding sources for Genesis Investment are complete."

"All funds in the account came from profits from crude oil and ruble trading recorded by Merrill Lynch."

"The relevant forward, option, and spot positions have also been broken down according to different maturities and risk categories."

Lu Jingyi opened the documents and pushed several risk control reports to the center of the table.

"The client did not use inside information, nor did they have access to the Swiss National Bank or the European Monetary Policy Department."

"His judgment is based on an independent analysis of expectations for the European Central Bank's quantitative easing, the Swiss National Bank's balance sheet, and the flow of funds in the Eurozone."

The executive in the video frowned.

"Independent analysis?"

"An 18-year-old Chinese high school student predicted in advance that the Swiss National Bank would abolish the exchange rate floor that it had maintained for more than three years?"

The meeting room was completely silent.

This is also the part that is hardest for everyone to accept.

If Chen Mo were a macro fund manager with decades of experience in international markets, they might be able to understand it to some extent.

But it's clearly written in the system information.

Eighteen years old, a senior high school student, registered residence in Jiangcheng County, Changhu City, Shaanxi Province.

The contrast between this status and billions of dollars in profits is far beyond what is reasonable.

"Age cannot be used as evidence to deny customer analysis capabilities."

Lu Jingyi met the other person's scrutinizing gaze and spoke clearly:

"Before the ruble crisis, no one believed he could accurately predict the correlation between crude oil and the Russian monetary system."

"But facts have proven that the market will not refuse to operate according to a person's judgment just because he is young."

Li Lin coughed softly.

"The focus now is not on discussing why Mr. Chen was able to make an accurate judgment."

"Instead, it completes transaction verification and profit settlement."

A risk manager stated coldly, "Some trades occurred during periods of severe liquidity shortage. The European trading desk believes that screen quotes do not necessarily represent actual tradeable prices."

Lu Jingyi's eyes instantly turned cold.

coming.

After the market calmed down, some people indeed began to take advantage of these transaction records.

Losses can be attributed to extreme market conditions, but when it's time for clients to make huge profits, the quotes become unrealistic.

She opened another document.

"The over-the-counter derivatives agreement signed between Chuangsheng Investment and Merrill Lynch has clear provisions on transaction confirmation, cash settlement, and handling of extreme market conditions."

"All option exercise instructions are issued through an encrypted trading channel within the validity period."

"Merrill Lynch's trading desk has also confirmed this."

"To question the transaction price now is tantamount to questioning the validity of Merrill Lynch's own trading system and agreement."

The person in charge of risk management looked slightly grim.

"Ms. Lu, I was just fulfilling my risk assessment responsibilities."

"I am also protecting the legitimate rights and interests of my clients."

Lu Jingyi refused to budge an inch.

"If Merrill Lynch refuses to acknowledge the confirmed transaction, Creation Investment has the right to initiate dispute resolution and default proceedings."

"At that time, the loss will not be just one customer."

"And Merrill Lynch's credibility with institutional clients worldwide."

The meeting room fell silent again.

Li Lin glanced at Lu Jingyi and secretly admired her.

She usually appears calm and radiant, but once she sits at the negotiating table, she becomes sharp and leaves no room for compromise.

More importantly, she was right.

During his time in Hong Kong, Chen Mo reviewed almost every clause in the agreement regarding extreme market conditions.

At the time, many people thought he was being overly cautious.

In retrospect, those seemingly harsh requirements have all become iron chains that lock in profits.

……

At the same time.

Internal risk meetings between Goldman Sachs Asia and Morgan Stanley are also being held urgently.

The existence of diversified accounts at Creation Investment meant that all three institutions could only see a portion of the positions.

It wasn't until the Swiss franc crisis erupted and they began reviewing their transactions that they realized the Cayman company might have established similar positions in other institutions.

But no one knows the full picture.

Goldman Sachs only saw a portion of the short positions in the euro/Swiss franc pair and Swiss franc options.

What Morgan saw was forward contracts and a small amount of spot exposure.

Merrill Lynch had the most information, but they also didn't know how much money Chen Mo had invested in other accounts.

This deliberate diversification of accounts allowed Chuangsheng Investment to avoid centralized risk control by a single institution, and also prevented any investment bank from seeing the full picture.

new York.

After reviewing the settlement report, the head of Goldman Sachs' global foreign exchange business said only one sentence:

"Find the actual controller of Genesis."

The head of the Asian team remained silent for a moment.

"We've found it."

"Who is it?"

"An eighteen-year-old Chinese student."

The video conference fell into a deathly silence that lasted for several seconds.

……

Villa No. 16, Guanlan Royal View.

Chen Mo ignored the chaos outside.

He sat in his study, checking the preliminary settlement statements sent by the three institutions one by one.

The numbers are enormous.

However, preliminary settlement does not equate to actual receipt of funds.

Especially in extreme market conditions, some forward contracts and options involve different counterparties.

If a counterparty has gone bankrupt or is unable to complete the transaction, the investment bank may request a delay in confirmation.

This is the truly dangerous aftermath of the Swiss franc storm.

My phone suddenly rang.

Li Lin.

Chen Mo pressed the answer button.

"Mr. Chen."

Li Lin's voice was clearly tired.

"Merrill Lynch has completed its first round of internal review. The vast majority of transactions are without issues, but the European risk department raised price disputes regarding a few cash-settled options trades."

"What is the amount in dispute?"

"Approximately 270 million US dollars."

Chen Mo's eyes remained completely unmoved.

"reason."

"They believe that in the short period following the event, the Swiss franc market did not generate continuous and effective quotes. The prices returned by some liquidity providers may not represent normal market levels."

Has the transaction been confirmed?

"Confirmed."

"Then settle according to the agreement."

Chen Mo answered very decisively.

Li Lin smiled wryly: "Mr. Chen, the amount is too large; headquarters can't possibly not review it again."

"Auditing is acceptable, but defaulting on payments is not."

Chen Mo opened the agreement text on the table.

"Article 6 of the main agreement and Article 3 of the supplementary agreement clearly stipulate the market disruption events and alternative pricing mechanisms."

"If Merrill Lynch deems the traded quote invalid, it will submit executable quotes from three independent market makers for the same time period."

"If you can't pay, we'll settle the payment at the confirmed price. If the money doesn't arrive by the agreed time, my lawyer will initiate breach of contract proceedings directly."

There was a moment of silence on the other end of the phone.

Li Lin was not surprised.

This was the clause that Chen Mo valued most during the agreement meeting.

"I will pass your feedback on to headquarters."

"It's not an opinion," Chen Mo said calmly, "it's a contract."

"clear."

Less than ten minutes after I hung up, Goldman Sachs called me back.

Both involve settlement review, abnormal market conditions, and attempts to extend the confirmation time.

Chen Mo's answer remained unchanged. "Act according to the contract."

He didn't get angry or threaten to withdraw investment; he simply repeatedly brought everyone back to the legal terms that had already been signed.

The more this is the case, the less the institutions dare to underestimate it.

A gambler who suddenly becomes rich can be manipulated by emotions.