Chapter 17
Translator: Dreamscribe
“Team Leader nim?”
At Deputy Manager Lee Hye-rin’s voice, I snapped back to my senses.
There’s something I’ve learned while working at this securities firm.
This 'feeling' of mine is based on collected data.
In other words, it’s not like I get sudden feelings randomly like a madman, but rather it's a system that organizes and sends me feelings based on specific field data I've acquired.
That intuition of mine is telling me something.
The collapse of the Chinese bubble is just around the corner.
Just like in the scenario I’m holding in my hands.
“So, what you’re saying is that everything we said would rise, if the Chinese stock market bubble bursts, it’ll all go the other way, right?”
"Ah...... Yes. That would be the case. But while it's true there's a bubble, it's not going to burst right now."
“I also think, based on what the Research Team analyzed, it could go up by as much as 300%.”
Rationally speaking, this makes sense.
Everyone here graduated from a good university and has built up experience in the stock market.
Would people like that not realize there’s a big bubble in China?
And yet, the reason they’re still throwing themselves into this market is that they’ve judged it’s still too early for the bubble to burst.
Even from my perspective, with less financial knowledge and experience than them, China was a land flowing with milk and honey.
They all knew that just by gathering every penny they had and getting on the upward trend, they could duplicate their money.
"Team Leader nim. You think the Chinese stock market bubble will burst?"
The team members all looked at me with eyes full of disbelief.
“Yes.”
At my answer, short sighs leaked out here and there.
“Well, we all know the bubble will burst eventually. But surely you don't think it will burst right now?"
“The Chinese government created an investment boom through interest rate cuts, easing real estate regulations, and expanding access to the stock market. As a result, the people there jumped into the investment market by going into debt. They even created a structure where the higher the stock prices go, the more money people can borrow, and now the number of new stock accounts has surpassed 90 million.”
The reason for the Chinese stock market’s rapid growth in just one year was the direction of government policy.
They put forward the policy of “let’s revitalizing stock market and generate wealth”, pouring fuel on the fire of economic growth.
As a result, everyone, without exception, stepped into the stock market, creating an investment frenzy.
And it didn’t stop there. The Chinese government took it one step further, inciting the public by claiming that investing in stocks was the only way to become rich.
State-owned funds actively intervened in the market in line with these policies, artificially raising the stock prices of state-owned enterprises to reassure investors.
That the Chinese government would never let the stock market collapse.
Through this snowball effect, the Chinese stock market created a massive bubble, soaring 150% in just one year.
“I fully understand what you’re saying, Team Leader nim. It’s obvious to anyone that this is a bubble. And yes, it’s a ticking time bomb. But not right now. Isn’t everyone saying the same thing? That the bubble still has a long way to go before it bursts? Even if you just look at the indicators, China’s growth trajectory isn’t over yet.”
“Yes. More importantly, there’s no trigger that could burst the Chinese bubble. The only variable is if the Chinese government suddenly changes its stance, but even just yesterday, the Chinese government issued another round of propaganda, didn’t they? Telling everyone to grab their money and rush into the stock market.”
“I think the Chinese government now believes they can’t stop. Since they’ve already driven it up 150%, they might as well aim for 300%.”
The research data, my team members, probably even the people outside this room.
They’re all saying the same thing.
That the Chinese stock market has no brakes.
No, they say the brakes have been ripped out completely.
‘Rationally speaking, everything these people are saying is correct, but......’
I’ve never once made a rational investment until now.
I’ve always followed this instinct that explodes inside me.
And the one that always wins isn’t my rationality, but this sense.
“The recommendations from the current research data are weak, so let’s create a portfolio under the assumption that the Chinese stock market collapses.”
“T-Team Leader!”
"Are you really going to bet on a decline? Really?"
“Yes. The only way we can currently invest in China is through ETFs, right? We can’t handle overseas options. So let’s dig into that further. And also ask the Research Team in more detail about what kind of impact a collapse in the Chinese stock market would have on the Korean stock market.”
Then we could take short positions on the relevant stocks, or even purchase derivative products like the options currently available in the market.
“Shall we start trading once the data is ready?”
* * *
Team 7's first meeting.
After the meeting ended and the team members left the Team Leader’s Office, most were shaking their heads.
"No. What on earth is he thinking? Am I the only one who thinks this is strange?"
When Manager Seo first voiced his dissatisfaction, Deputy Manager Ahn beside him nodded in agreement.
“It’s definitely strange. Right now, the only person predicting the Chinese bubble will burst immediately is the Team Leader.”
“That’s what I’m saying. Just go out there and grab any random person walking around Yeouido and ask them. If you say the Chinese bubble is about to burst, see what kind of reaction you get. You’d be lucky if they don’t call you a moron.”
Then a sharp voice came from the other side.
“Are you insulting our Team Leader right now?”
“No, Deputy Manager Lee Hye-rin. I’m not insulting the Team Leader, but come on, even you have to admit it’s strange. Can you honestly say it’s not? Huh? Can you?”
Right now, the Chinese stock market is booming.
You can tell just by looking at what the other teams are doing.
Everyone is convinced the Chinese stock market will continue rising and is taking long positions.
But that new Team Leader is trying to go against this flow.
You don’t even need to say what happens to people who go against the market trend in the stock world.
“It’s strange, yes. But I want to believe what the Team Leader says.”
“What?”
“I haven’t known the Team Leader for long, but he’s never once failed in an investment so far. He got promoted to Team Leader at lightning speed not long after joining the company. Don’t you think there’s a reason for that?”
“No. That’s because the Team Leader came in as a parachute hire......!”
Manager Seo raised his voice but quickly lowered it again.
“Whew. Anyway, we have to follow the Team Leader’s instructions, so everyone go gather the data first. I’m going to go have a smoke.”
Leaving the department, Manager Seo headed to the smoking area with a cigarette in his mouth.
Yeah. A bubble. It could burst.
No. It’s bound to burst eventually.
But just because it’s going to burst someday doesn’t mean you place a bet on it now.
This is the Prop Trading Department, which lives off short-term trading.
It’s a place where holding a stock for more than a week is rare.
But if you bet on the bubble bursting, you can’t predict how long you’ll have to wait for it.
It could be several months. No, maybe even a year.
For a prop trading team that settles accounts monthly based on returns, long-term investments are fatal.
And even if the bubble bursts a year later, they might’ve already lost all their money by then, making it hard to ride the trend.
“Phew-”
Manager Seo was alone in the smoking area.
It’s been a while since he smoked at this hour.
Of course. The market just opened, so everyone else must be going wild right now.
While others were easily making money like sucking honey, Manager Seo was pitifully sucking on a cigarette.
“Should I just switch teams?”
But that’s not easy.
Think about it.
This guy came in as a parachute hire and was promoted to Team Leader at lightning speed.
That means he’s got powerful backing.
Probably from a royal family background, and if you get on the wrong side of someone like that, you can kiss your career goodbye.
"I don't know what I'm supposed to do."
If we end up losing all our money like this, the team might just blow up.
Wouldn't that be even more fucked?
All sorts of thoughts were flashing through his head.
After everything it took to become a Manager.
Why such trials......!
“Screw it. If he says jump, I jump.”
What else can you do?
The other party is a high-ranking official, and I’m just an ordinary person who’s a manager.
“Manager, the Research side just sent over the materials.”
When he quickly returned after his smoke, Deputy Manager Ahn handed him the data.
“Yeah? That was fast.”
“Yes. It looks like they were already expecting the bubble might burst someday, so they had a scenario prepared in advance.”
Manager Seo glanced at the document the Team Leader had been holding earlier.
To see which analyst had already written that bullshit about a bubble collapse.
But once he actually looked, the data was more lacking than expected.
It seemed like even the person from this department had only included it for reference.
But could it really be that he made that decision based solely on this?
“Whew. No, never mind. Give me that data. I’ll deliver it to the Team Leader myself.”
“Ah, yes.”
Manager Seo took the data and entered the Team Leader’s Office.
Even though the market had opened, this was probably the only place that was this peaceful.
“Team Leader. The data has arrived.”
“Ah. That was fast.”
“Yes. In the securities world, time is everything.”
Jung Jin-ho stared at the data for a long time and began checking through the stocks sent by the Research Team one by one.
Did he have his own criteria for selecting stocks?
Manager Seo couldn’t shake off the uneasy feeling inside.
So he opened his mouth one last time.
“Team Leader. Are you really going to go through with this?”
Jung Jin-ho, who had been going through the products and checking them one by one, set his pen down.
“Manager. While there’s a team strategy, a prop trader is ultimately an individual. That’s why individual decisions matter, and the company evaluates us based on those. So, if you really believe your decision is right, then you should go ahead with it. I’ll respect that.”
So basically, if you don’t trust him, do whatever you want?
“Please deliver this data to the team members. Tell them they can pick stocks from here to invest in, or if they find something better, they’re free to invest in that instead.”
“Yes.”
Manager Seo took the documents and was about to leave the Team Leader’s Office.
Then Jung Jin-ho stopped him.
“Oh, and... since this investment strategy is something I decided on, I’ll take responsibility for it as well.”
“......Yes.”
Manager Seo left the Team Leader’s Office, gave instructions to the team members, and sat at his desk.
‘If I believe I’m right, go with my own judgment?’
Manager Seo stared blankly at the screen.
The ETF window related to the Chinese stock market currently on the market was open.
According to the Team Leader’s instructions, he should be buying the ETF on the right, one that no one else was touching.
But if he bought the one on the left, he could secure a decent return this month with no issues.
‘But if I really do what I want... I’ll be the only one who has to deal with the aftermath, won’t I?’
There were times when conflicts arose between Team Leaders and team members because their views didn’t align.
He didn’t know about other companies, but at least in a securities firm, a Team Leader can’t force a team member to invest.
They were only grouped as a team.
These people were prop traders who signed individual contracts with the company.
So when their opinions differed, even if it soured relationships a bit, they would invest however they wanted.
But that Team Leader was different.
If you got on his bad side, it was no different than getting on the bad side of the higher-ups.
He had just joined the company recently and already become a Team Leader, and yet not a single person from the upper management had raised any objections.
That said everything.
“Right. He said he’ll take responsibility.”
From that, he could feel the confidence.
It meant that even if they lost all their money, the team wouldn’t be dismantled.
How powerful must his background be to say something like that?
Click-click-.
Manager Seo began to make his purchases in earnest.
He bought into the ETF, shorted the steel sector, and allocated a certain amount into other derivatives.
He followed exactly what Jung Jin-ho had checked, without a single deviation.
[Your investment ratio has exceeded the risk management limit......]
Just like that, a warning message arrived from the Risk Management Team like clockwork.
Since he was going against the flow of the market and funneling money into something odd, they sent out a quick warning from their side too.
He wavered slightly at that point but-.
“Risk management?”
Whatever. I’m not doing it.
*****
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