"Haha, in this unilateral plunge, the experience of holding short positions in stock index futures is much more exhilarating than holding stocks."
Lin Minghui had already completed clearing all positions in his stock account.
At this moment, looking at his stock index futures account which had added several million in profit, his face was full of smiles.
"Keep falling, even if there are several more limit-downs for a thousand stocks, I'm not afraid."
"A few more thousand-stock limit-downs might directly trigger systemic financial risks."
General Manager Deng's stock index futures account also had substantial unrealized gains at this moment, but his expression was much calmer than Lin Minghui's.
"If the market plunges again today and closes with a thousand stocks hitting limit-down... I'm afraid the regulatory authorities will make big moves over the weekend."
Everyone knows that maintaining the bottom line of preventing systemic financial risks is absolutely the top priority of regulatory work.
The market has plummeted so continuously, lacking liquidity.
General Manager Deng felt that the regulatory authorities could not ignore it and could not avoid intervening in the market.
Su Yi heard General Manager Deng's words and couldn't help but feel concerned about this.
Based on his memories and experiences from before his rebirth, he clearly knew that the regulatory authorities would definitely rescue the market, but he couldn't remember the exact timing when they would centrally introduce rescue measures.
However, analyzing the current market trend and the continuous thousand-stock limit-down phenomenon of the past few days.
With the entire market already beginning to shift from a liquidity crisis to systemic financial risk.
Coupled with the two days of the weekend, which are very conducive to the fermentation of emotions.
Su Yi comprehensively judged that if the regulatory authorities were to rescue the market, introducing corresponding measures this weekend would be the best timing.
Thinking of this, he knew that this time, he could not hold positions over the weekend.
He must choose to take profit on his holding accounts at today's relatively low intraday point, thereby dealing with the uncertainties of the weekend news.
"Even if there are big moves, what good will it do?"
Lin Minghui said,
"After the Shanghai Composite Index effectively broke below 4000 points, the bull market is completely over. Now, the chips from the entire bull market are loose, trillions of leveraged funds, and tens of trillions of institutional principal funds are all fleeing for their lives.
Even the central bank's emergency interest rate cuts and reserve requirement ratio cuts can't stop the decline. What good methods can the regulatory authorities have? If you ask me... we can only wait for a wave of risk to be fully released before there can be a real rebound."
After the Shanghai Composite Index effectively fell below 4000 points and continuous thousand-stock limit-downs occurred.
He completely stopped believing in the bull market and became firmly bearish.
"Even if the regulatory authorities don't have good ways to curb the market's continued plunge, they must rescue the market."
General Manager Deng continued,
"Many stocks in the market have already halved from their highs during the recent continuous limit-downs. If they fall further... many shares pledged by major shareholders will face margin calls, and once these pledged shares face margin calls, they will instantly jeopardize the banking system, leading to comprehensive financial risks."
Lin Minghui pondered for a moment and said,
"So, according to your opinion, Old Deng, should we... close positions and take profit now?"
"You're right."
General Manager Deng nodded,
"I think it's almost time to quit while we're ahead."
"You really lack vision."
Lin Minghui gently shook his head, disagreeing with the other party's view.
"Even the stock god said, 'Be fearful when others are greedy, and greedy when others are fearful.' At this moment, the entire market is in a unilateral plunge. All stock investors are still in despair and fear, and there is no sign of the market stopping its fall. Why not continue to be greedy?"
Speaking of this, Lin Minghui hurriedly turned his gaze to Su Yi and said with a smile,
"Brother Su, what do you say?"
Su Yi's eyes were fixed on the 'CSI 500 Index Futures Main Contract' which was approaching an 8% decline, and the Shanghai Composite Index which had already broken through a 5% decline.
He said,
"I think General Manager Deng is right, it's time to take profit."
Lin Minghui was completely surprised that Su Yi's thoughts aligned with General Manager Deng's, and exclaimed,
"Didn't you say before 'the bears won't stop until the bulls are dead'? At this moment... many bulls in the market aren't dead yet, are they? And there are still quite a few people who hold onto hope for a bull market!"
"That's true,"
Su Yi said.
"but we also have to consider the factor that our A-share market is a policy-driven market."
As he spoke, Su Yi began to gradually cover his short positions when the thousand-stock limit-downs reappeared in both markets and the 'CSI 500 Index Futures Main Contract' approached the limit-down level.
Seeing Su Yi began to close positions without hesitation.
Lin Minghui struggled and hesitated internally for a moment.
Although he still didn't entirely agree with Su Yi's and General Manager Deng's views, his body honestly followed suit, closing his short positions and taking profit at the appropriate time.
After Su Yi had completely closed all 150 short positions he held.
He had harvested nearly 60 million in profit, and his total account assets reached over 75.4 million.
At 10:45 AM, a massive group of mysterious funds began to appear concentrated in the market again, rapidly buying a series of central state-owned enterprises (SOEs) and state-owned enterprise (SOE) stocks, forcibly driving up the already collapsed Shanghai Composite Index.
Just as Su Yi thought this mysterious fund was using its old trick, only pulling up weighted stocks to maintain a brief prosperity for the Shanghai Composite Index, he saw more bottom-fishing orders beginning to follow the mysterious fund's upward pulling action.
Rapidly pouring into many small and medium-cap concept stocks that had already hit limit-down, and driving the core component stocks of the ChiNext Index and SME Board Index to rebound upwards.
"Huh..."
Su Yi saw two groups of principal funds with clearly different compositions actually starting to collaborate and coordinate, and he couldn't help but exclaim in surprise, thinking to himself,
"It seems there's indeed some movement on the news front. Many clairvoyant smart funds have already begun to concentrate on bottom-fishing."
There's no airtight wall in the market.
Regardless of important news, good or bad, there are always smart funds that are clairvoyant.
And market trends always react in advance.
Having been a trader at large institutions for many years, Su Yi was no stranger to this phenomenon.
However, before the positive market news had truly materialized, facing the combined downward pressure from trillions of leveraged funds fleeing for their lives and countless institutional principal funds passively reducing their positions.
These smart bottom-fishing funds acting in advance, and the mysterious funds tasked with stabilizing the market.
Although they briefly pushed the Shanghai Composite Index, Shenzhen Component Index, and ChiNext Index into positive territory, they ultimately failed to save the market or resolve the liquidity crisis.
Instead, they caused an even more panicked and brutal sell-off in the market during the closing phase after 2 PM.
Finally, when 3 PM arrived and both markets closed.
The Shanghai Composite Index still closed with a plunge of 5.77%, while the ChiNext Index and CSI 500 Index also closed with even more severe declines of 6.36% and 7.08%, respectively.
As for the 'CSI 500 Index Futures Main Contract' which Su Yi had fully taken profit and closed positions on.
It also remained locked at the limit-down during the closing phase.
The entire market displayed a rare and dramatic inverted V-shaped trend throughout the day, with a massive amplitude, but ultimately, it still couldn't change the outcome of a 'thousand-stock limit-down'.
(End of Chapter)
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