The stock dropped by 60 cents!
With 5 million shares, closing the position now would mean a profit of 3 million. Compared to the previous loss of 40 million, 3 million was just a drop in the ocean.
But the calculations couldn’t be limited to just today’s 5 million shares sold. On the 16th, Xia Xiaolan also sold 4 million shares of Lu Family Media at 21.7 dollars. If they closed the position now, with both selling and buying prices at 21.7 dollars, those 4 million shares from the 16th wouldn’t incur any losses either.
As for the stocks of the other four listed companies… Wait!
Zhang Bailun just realized that the stocks of the other four companies were falling too. Though not as dramatically as Lu Family Media’s 60-cent drop in the first ten minutes, even the most stable stock had fallen by 20 cents compared to the closing price on the 16th!
The 16th was when Director Xia made her most aggressive short sales, selling a total of 7.5 million shares. Naturally, the biggest losses came from those 7.5 million shares sold on the 16th.
If the stock price fell to the levels before the 16th, even to the closing price of the 15th, and Xia Xiaolan chose to close the position, not only would they avoid losses today, but they could also recover three-quarters of the 40 million loss! The losses would be controlled at around 10 million Hong Kong dollars. This would already be a very good outcome. Losing 10 million was far better than losing 40 million.
Zhang Bailun asked excitedly, “Director Xia, shall we close the position?”
Ji Jiangyuan patted Zhang Bailun’s shoulder, “Stay calm. Does today’s Hong Kong stock market look normal to you? Closing positions now would mean missing the chance to turn losses into profits.”
It was indeed abnormal. But closing positions now would be the safest option. Well, he was too naive – cautious people wouldn’t act like Director Xia.
Xia Xiaolan had a smile at the corner of her mouth, but wasn’t as excited as Zhang Bailun imagined, making him think his young boss was profound and didn’t care about gains or losses of tens of millions—
How could Xia Xiaolan not be excited?
The 1987 stock market crash she had waited for from summer to autumn had finally arrived. Why wouldn’t she be excited?
Her memory hadn’t been wrong!
The crash came!
Xia Xiaolan’s current “mysteriousness” wasn’t forced at all. Her excitement had nothing to do with avoiding a 30 million Hong Kong dollar loss.
If she smiled too broadly now, how would she express her joy when she turned the losses into profits and earned 30 million, 300 million, or even more?
Right now, she needed to stay composed.
“Just wait, it’s only 10:15.”
Yu Li’s cheeks were flushed with excitement.
Director Xia wouldn’t lose.
Only others would lose!
Outside in the trading hall, the bustling sounds could no longer be contained.
What was happening today? Just 15 minutes after the market opened, the Hang Seng Index had dropped 120 points.
No, no, no, don’t panic. It’s only 120 points, it could still stabilize.
The thoughts of the traders in the hall were similar to Xia Ziyu’s thoughts.
Xia Ziyu recalled what the CR employee said about the U.S. stock market decline and used this to encourage Lu Yunshi:
“Hong Kong people are easily spooked. The U.S. stocks fell, frightening some people who worry that Hong Kong stocks will fall too, so they’re selling at market open. Don’t worry, today we just need to watch Qihang and see if there are any large-scale selloffs.”
Qihang’s trading style was quite aggressive, probably related to Xia Xiaolan’s personality. Afraid of not being high-profile enough to attract attention, they always made large-scale sales, making their style immediately recognizable—
As long as Xia Xiaolan didn’t continue with large-scale selling, Xia Ziyu didn’t plan to buy in yet.
With the market dropping several cents at the opening, she couldn’t go against the market trend.
When the trader asked Xia Ziyu whether to close positions, she flatly refused and instead sent her assistant to buy desserts. She planned to accompany Lu Yunshi for tea and snacks in the VIP room.
Lu Yunshi also calmed down.
“Fifth Madam has such spirit.”
Lu Yunshi had once stirred up trouble between Xia Ziyu and Liu Keying.
That was to help Du Zhaohui.
Who knew that useless Du Zhaohui wouldn’t remember the favor? Hmph, now there was nothing wrong with her joining forces with Fifth Madam to deal with that northern girl!
Meanwhile, Xia Ziyu and Lu Yunshi were having tea and snacks in the VIP room, chatting about fashion and other topics. Lu Yunshi also inquired about Du Chengrong’s health condition. Both temporarily tried to ignore the falling stock prices.
But just because they chose not to think about it didn’t mean the stock prices would rebound.
Within the first 15 minutes of market opening, the Hang Seng Index had dropped 120 points, and from 10:15 to 12:00, it fell another hundred points on top of that.
At market opening, the Hang Seng Index was at 3,782 points.
By noon sharp, the Hang Seng Index had fallen to 3,524 points.
In just one morning, it had dropped 258 points.
This certainly wasn’t good news.
Xia Ziyu and Lu Yunshi could ignore how the Hang Seng was falling, but Lu Family Media had dropped from 22.3 dollars at market opening to 21.2 dollars. In one morning, it had fallen 1.1 dollars – this wasn’t good news at all.
Xia Ziyu and Lu Yunshi had both bought in at 22.1 dollars and now each share had dropped by 90 cents.
What did this mean?
It meant that in just one morning, the 3 million shares Xia Ziyu bought today had lost 2.7 million.
The 2 million shares Lu Yunshi bought on behalf of He Zhitong had lost 1.8 million.
Although Xia Ziyu wasn’t happy, she didn’t lose her composure.
She could afford to lose less than 3 million Hong Kong dollars.
Even for the 6 million shares bought at 20.2 dollars on the 16th, if they closed positions now, they wouldn’t make 12 million, but they would still profit.
It just changed from 12 million to 6 million.
After deducting this morning’s loss of 2.7 million, the total profit would still be 3.3 million — from making 12 million to only making 3.3 million, in one transaction, nearly 9 million had evaporated. No one would truly be happy about this.
Xia Ziyu stood up:
“Let’s wait for the afternoon. Abby, since we hit it off so well, shall I treat you to lunch?”
Lu Yunshi also felt that sitting here was too stressful, and better to shift their attention elsewhere.
As the two walked arm-in-arm out of the VIP room, they ran into Xia Xiaolan.
Xia Xiaolan was walking with a light step, discussing plans to celebrate at a grand restaurant with her companions, who were constantly flattering her with “Director Xia” this and that, making both Xia Ziyu and Lu Yunshi’s eyes hurt.
Today Xia Xiaolan sold 5 million shares of Lu Family Media at 22.3 dollars. By lunch break, with the price down to 21.2 dollars, while Xia Ziyu and Lu Yunshi lost 0.9 dollars per share, Xia Xiaolan made 1.1 dollars per share.
This was what opposing positions meant.
When one side profits, the other side loses.
When one side loses, the other side profits.
In just one morning, Xia Xiaolan had made back 5.5 million.
No, even more than that. Now that Lu Family Media’s stock price had fallen below the opening price of 21.7 dollars on the 16th if Xia Xiaolan chose to close positions now, she would profit from the 4 million shares she sold on the 16th too – making 50 cents per share, earning back 2 million… All morning, while the market had been falling, Xia Xiaolan had probably almost recovered her losses on other stocks as well.
Xia Ziyu was about to have a heart attack.
Don’t close positions!
Whatever you do, don’t close positions!
“Congratulations, you’ve almost recovered your losses in just one morning.”
Lu Yunshi tugged at Xia Ziyu’s arm, wondering why she was congratulating Xia Xiaolan.
“It’s only been one morning, why congratulate her? She hasn’t won yet!”
Xia Xiaolan sneered, “You two don’t need to play good cop, bad cop. I’ve already said, that whoever runs away midway is a puppy. Even though I’ve recovered some losses, you two should still be profiting. Why not just admit you’re puppies and quickly close your positions and leave? You’ve made a few million, enough for you to buy clothes and jewelry — after all, you don’t have tens or hundreds of millions to lose, be careful not to get in too deep!”