How to lose 20 Billion in 2 days
- Thread starter Pekelo
- Start date
Why don't you click on the link?
no. That would be considered hedging. Or it would be “coincidental” that the options trader happened to buy puts before the prime brokerage division sold.
Shows "404 no such page found" for me TBH
Let's try this:
https://www.bloomberg.com/news/feat...-archegos-capital-lost-20-billion-in-two-days
Video:
https://www.bloomberg.com/news/vide...st-rise-and-even-faster-20-billion-fall-video
Or:
bloomberg. com search for "Hwang", first article
Last edited:
Only half right.
When Hwang was in trouble after receiving multiple margin calls, he held a conference call with all the large banks involved. The discussed various plan to unwind his positions orderly. So that was the first time that those banks knew the scale of his positions. No agreement was made. So Mr. Hwang was naive with this.
So the capitalism has no bound. Morgan Stanley started selling first to private investors, Goldman was maybe hours behind. Credit Suiss and Nomura did not have the market depth to sell those large positions. So some used open market. Some of the Goldman block trades were reported on Friday morning which were sold Thursday night.
Clearly Hwang made a dumb move to have that conference call. Also he had no control of his swap positions since he can't unwind them himself. This is different from holding stocks or future positions himself. But legally he could not do.
Both Goldman and Morgan Stanley would damage their own reputation too. Next time for something like this, Hwang II would just kept this to himself and would not have any conference call. His loss could have been lower. No one knows....
Just think of that giant tax bill from 2020 gains and no way to pay for it.
That is the most fascinating part of the story.