Reborn Xiangjiang as a Tycoon

Chapter 152 Futures Trading Adjustments

Before deciding how to operate, Lin Baicheng first calculated his current investment in gold futures.

First of all, around November last year, a US$100 million loan was obtained from Goldman Sachs using the shares of Galaxy Games. It was originally intended to be used to acquire Wharf. However, due to Li Jiacheng's intervention, the acquisition failed, so the money was used to invest in gold.

For futures, using 5 times leverage, the cost of buying at that time was $163 per ounce.

Then there was the US$10 million principal of Bailong Commercial Co., Ltd., using 10 times leverage and a cost price of US$182 per ounce.

Finally, there are the ones I bought just a few days ago. They are Hutchison Whampoa’s principal of US$150 million, using 5 times leverage with HSBC, and the cost price is US$188/ounce; Lin Baicheng’s own capital of US$100 million was purchased by Standard Chartered

The bank used 5 times leverage, and the cost price was US$188.5/ounce; the principal of US$100 million was used by Mitsubishi Bank, which used 5 times leverage, and the cost price was US$189/ounce.

At present, all gold futures orders are profitable, and when using 5 times leverage, they have made at least a dozen points.

Calculated in terms of financing leverage funds, Lin Baicheng invested a total of US$2.35 billion in long gold futures, which is already a large long position.

Calculating with more than 2 billion U.S. dollars in funds, if the gold price really adjusts, even if it only adjusts by 5%, it will still be 100 million U.S. dollars, which is not a small sum for any country in this era.

Therefore, Lin Baicheng really couldn't remain indifferent.

"First of all, we must make it clear that the long-term trend of gold prices will not change. The highest price in 1980 exceeded US$800 per ounce."

“Therefore, although many institutions this time believe that the price of gold cannot break through the price of 200 US dollars per ounce and will fall back, this is only a possibility and not a 100% certainty, so I cannot cancel all long futures orders.

Not to mention shorting everything. If the price of gold can exceed 200 US dollars per ounce this time, but I short everything, then I will lose money, so this is definitely not advisable."

"However, there is still a possibility of a correction, and this possibility is not small, so I can't do nothing. After all, a 5% correction will cost me more than $100 million."

"The general direction of going long remains unchanged, but I have to prevent the losses caused by the correction of gold prices, so it is obvious what to do."

After some thinking, Lin Baicheng made a decision. However, he decided to wait and see what Yuan Tianfan on the other side of Xiangjiang had to say. Yuan Tianfan's views were also one of the basis for his reference.

In the last test, the buying cost price of Yuan Tianfan's group was 0.5 US dollars/ounce lower than that of Anyuan's group. Obviously Yuan Tianfan's group had higher capabilities. Even though it was only 0.5 US dollars/ounce, Yuan Tianfan's group operated

The capital was US$750 million, which saved Lin Baicheng about US$2 million.

It can be seen that a talented person with strong ability is indeed very important. Although the salary must be higher, the benefits he can create are also more and it is worth the price.

Nearly an hour after Lin Baicheng contacted Cheng Yufeng, Cheng Yufeng reported the situation to Lin Baicheng. Yuan Tianfan believed that if the price of gold does not touch or exceed US$200 per ounce in the next three trading days, it is very likely that an adjustment will occur.

If an adjustment occurs, we need to observe whether it will fall below the last adjustment low of US$180 per ounce. Once it falls below, there will be another wave of decline.

On the contrary, if the price of gold touches or exceeds 200 US dollars per ounce within three trading days, then the possibility of gold price adjustment is unlikely, but there is more room for upwards, and you should continue to go long.

In general, you should make decisions based on trends and follow the market.

Lin Baicheng had a plan. The futures market was unpredictable, especially at such a critical price level. Short-term changes were extremely fast, so he needed to make arrangements in advance. Otherwise, he would have to wait for the gold price to choose a direction and then he would have to do whatever he wanted.

It's too late.

Because the relationship between Xiangjiang and Tokyo was during the day, Lin Baicheng asked Cheng Yufeng to spend money to hire Yuan Tianfan as a consultant for a few days and go to London with Anyuan. Once the rise in gold prices encountered obstacles and there was an adjustment trend, he would immediately turn the price from bullish to bullish.

Short, also use 5 times leverage to short gold futures. If the gold price breaks through 200 US dollars per ounce, then naturally continue to go long. If the gold price first adjusts and then breaks through, you will continue to go long, using 5 times leverage as always.

In Tokyo, Lin Baicheng contacted Haruko Mouri and asked Haruko Mouri to do the same. If there was an adjustment, go short, and if there was no adjustment, go long. The funds used were always US$10 million, 10 times leverage, and this was the case regardless of long or short positions.

As for the US$300 million of Lin Baicheng's own funds, Lin Baicheng also has arrangements. Among them, the principal of US$200 million using Standard Chartered and Mitsubishi channels will remain unchanged. No matter whether there will be adjustments this time, nothing will be done.

The first US$100 million of funds to be used through the Goldman Sachs channel will be delivered during the day tomorrow, and the long futures orders will be delivered, and the funds will be left untouched without any operations.

Lin Baicheng generally focuses on long positions, so he only uses part of his funds to go short, and is ready to go long again at any time. In this way, if the price of gold exceeds 200 US dollars per ounce, he will definitely make a lot less, but the loss will also be small.

Not too big, acceptable.

And if the gold price really adjusts, then Lin Baicheng will not lose money. He has 850 million US dollars of operable funds in short selling, and he will also make a small profit. Although the 1 billion US dollars of untouched funds have lost money, as long as Lin Baicheng does not sell, he will still make a small profit.

If the price of gold rises in the future, he will still be able to make a profit, but in the short term it will just be a paper loss.

The next morning, Lin Baicheng took Isabella to Goldman Sachs, found Wade Thomas, and asked him to arrange for the trader to deliver his futures orders, so that the funds would be settled first.

Wade Thomas naturally had no objection and arranged for someone to do it.

Lin Baicheng also contacted Phil Smith. He told Phil Smith that he had sold part of the futures orders and left part untouched. As for what Phil Smith wanted to do, it had nothing to do with him.

Although the futures orders are about 600 million U.S. dollars, they are not very large in the entire gold futures market, so it only took less than two hours to complete the delivery. All futures orders were sold, and the average selling price was 195.8

US dollars/ounce, relative to the cost price of US$163/ounce, it has increased by as much as 20%.

Lin Baicheng's principal was US$100 million. Because Lin Baicheng used 5 times leverage, his profit this time was US$100 million plus more than US$600,000.

All the money is temporarily placed in that account and has not been transferred out. Because if the settlement is transferred out, Lin Baicheng will have to settle half a year's financing interest with Goldman Sachs. The problem is that there are still about two months until half a year, so settling now is equivalent to a loss.

, the funds raised were used less than two months.

Also, during settlement, Lin Baicheng will have to pay taxes on this profit. No matter whether he makes a profit or a loss next time, he has to pay taxes on what he makes this time anyway.

But if it is not settled, it will not be counted as making money for the time being, so there is no need to pay taxes. If you continue to operate next time and lose the profit earned this time, it means that Lin Baicheng has not made any money. If you make settlement at that time, it will be one penny.

No need to pay tax anymore.

Anyway, Lin Baicheng had no need to use the money for the time being, so it was more cost-effective not to settle it first, so he did not settle it and put the money in his account for the time being.

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(End of chapter)