CFDs - The Dirty Little Secret Behind The Collapse Of Archegos
Stop us if you've heard this one before - Wall Street prime brokers allowed hedge funds to dance while the music was playing with ever greater leverage in off-exchange and unregulated derivatives... until the first sign of trouble and the whole house of cards comes crashing down in a potentially systemic manner.
The bloodbath in various media stocks on Friday has brought light back to one of the dark corners of the equity trading business - so-called contracts-for-differences (CFDs).
As Bloomberg reports, much of the leverage used by Hwang’s Archegos Capital was provided by banks including Nomura and Credit Suisse - who have most recently admitted huge losses - as CFDs, which are made off exchanges, allow managers like Hwang to amass stakes in publicly traded companies without having to declare their holdings (far in excess of the 5% stakes that require regulatory reporting).
Crucially, as Bloomberg notes, this means Archegos may never actually have owned most of the underlying securities - if any at all - as the CFD is akin to a privately-arranged (i.e. off exchange and bespoke) futures contract where the differences in the settlement between the open and closing trade prices are cash-settled (there is no delivery of physical goods or securities with CFDs).
What makes the situation worse is that Archegos reportedly took positions in these CFDs with various prime brokers - and because these positions are by their nature not centrally cleared or aggregated, this left prime broker X unaware of their client's exposures with prime broker Y... which in this case was huge.
The leverage Hwang was given made him look like a trading genius as the various positions he took were pumped and pumped (and helped by gamma- squeezers) but now look like a reckless gambling fool as the bets collapsed.
CFDs linked to stocks (with a gross market value of around $282 billion at end June 2020) are among bespoke derivatives that investors trade privately between themselves, or over-the-counter, instead of through public exchanges. This is exactly the kind of hidden risk that amplified the losses during the 2008 financial crisis.
不用想都知道是cfd么。这种体量根本没有margin可以借的。看了一下，感觉这哥们要 坐牢了。 【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】 : 实际上就像是OTC forward contract（原理和exchange traded futures差不多） : https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse- : archegos : CFDs - The Dirty Little Secret Behind The Collapse Of Archegos : Stop us if you've heard this one before - Wall Street prime brokers allowed : hedge funds to dance while the music was playing with ever greater leverage : in off-exchange and unregulated derivatives... until the first sign of : trouble and the whole house of cards comes crashing down in a potentially : systemic manner. : The bloodbath in various media stocks on Friday has brought light back to : ...................
这哥们儿也不是第一次违规了 之前因为insider trading被要求不准成立管理public fund 所以他的基金是family fund 至于这钱怎么变成他的family fund估计是个公开的秘密 说实话 其实这些钱在整个市场来说根本引起不了任何系统性风险就是了 CFD总共也就282b的市场 而且不是说CFD在美国是不允许的么 Contracts for differences is an advanced trading strategy that is used by experienced traders and is not allowed in the United States.
比如现在Bidu $100 Hwang给GS押金$20 手续费$5 让GS去买bidu (leverage 5x, Hwang does not own any stock) 涨到$120, GS给Hwang $15就可以 如果跌倒$85, Hwang margin call 如果没钱 GS liquidate bidu stock
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】 : 实际上就像是OTC forward contract（原理和exchange traded futures差不多） : https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse- : archegos : CFDs - The Dirty Little Secret Behind The Collapse Of Archegos : Stop us if you've heard this one before - Wall Street prime brokers allowed : hedge funds to dance while the music was playing with ever greater leverage : in off-exchange and unregulated derivatives... until the first sign of : trouble and the whole house of cards comes crashing down in a potentially : systemic manner. : The bloodbath in variouhttp://www.mitbbs.com/img_rand/img_rand.phps media stocks on Friday has brought light back to : ...................
古老的东西。livermore就用过 【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】 : 实际上就像是OTC forward contract（原理和exchange traded futures差不多） : https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse- : archegos : CFDs - The Dirty Little Secret Behind The Collapse Of Archegos : Stop us if you've heard this one before - Wall Street prime brokers allowed : hedge funds to dance while the music was playing with ever greater leverage : in off-exchange and unregulated derivatives... until the first sign of : trouble and the whole house of cards comes crashing down in a potentially : systemic manner. : The bloodbath in various media stocks on Friday has brought light back to : ...................
又为什么是高盛在抛？野村通过在高盛的账户？ 【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】 : 实际上就像是OTC forward contract（原理和exchange traded futures差不多） : https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse- : archegos : CFDs - The Dirty Little Secret Behind The Collapse Of Archegos : Stop us if you've heard this one before - Wall Street prime brokers allowed : hedge funds to dance while the music was playing with ever greater leverage : in off-exchange and unregulated derivatives... until the first sign of : trouble and the whole house of cards comes crashing down in a potentially : systemic manner. : The bloodbath in various media stocks on Friday has brought light back to : ...................
太阳底下没有新鲜事，这天底下没有什么股神天才。最近在看关于 一本关于Jim Simons的书： "The Man Who Solved the Market "，总觉得关键的地方语焉不详，年 化收益40%保持几十年，后面没有猫腻才怪了。
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】 : 实际上就像是OTC forward contract（原理和exchange traded futures差不多） : https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse- : archegos : CFDs - The Dirty Little Secret Behind The Collapse Of Archegos : Stop us if you've heard this one before - Wall Street prime brokers allowed : hedge funds to dance while the music was playing with ever greater leverage : in off-exchange and unregulated derivatives... until the first sign of : trouble and the whole house of cards comes crashing down in a potentially : systemic manner. : The bloodbath in various media stocks on Friday has brought light back to : ...................
实际上就像是OTC forward contract（原理和exchange traded futures差不多）
https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse-
archegos
CFDs - The Dirty Little Secret Behind The Collapse Of Archegos
Stop us if you've heard this one before - Wall Street prime brokers allowed hedge funds to dance while the music was playing with ever greater leverage in off-exchange and unregulated derivatives... until the first sign of
trouble and the whole house of cards comes crashing down in a potentially
systemic manner.
The bloodbath in various media stocks on Friday has brought light back to
one of the dark corners of the equity trading business - so-called contracts-for-differences (CFDs).
As Bloomberg reports, much of the leverage used by Hwang’s Archegos Capital was provided by banks including Nomura and Credit Suisse - who have most
recently admitted huge losses - as CFDs, which are made off exchanges, allow managers like Hwang to amass stakes in publicly traded companies without
having to declare their holdings (far in excess of the 5% stakes that
require regulatory reporting).
Crucially, as Bloomberg notes, this means Archegos may never actually have
owned most of the underlying securities - if any at all - as the CFD is akin to a privately-arranged (i.e. off exchange and bespoke) futures contract
where the differences in the settlement between the open and closing trade
prices are cash-settled (there is no delivery of physical goods or
securities with CFDs).
What makes the situation worse is that Archegos reportedly took positions in these CFDs with various prime brokers - and because these positions are by their nature not centrally cleared or aggregated, this left prime broker X
unaware of their client's exposures with prime broker Y... which in this
case was huge.
The leverage Hwang was given made him look like a trading genius as the
various positions he took were pumped and pumped (and helped by gamma-
squeezers) but now look like a reckless gambling fool as the bets collapsed.
CFDs linked to stocks (with a gross market value of around $282 billion at
end June 2020) are among bespoke derivatives that investors trade privately between themselves, or over-the-counter, instead of through public exchanges. This is exactly the kind of hidden risk that amplified the losses during
the 2008 financial crisis.
今天Achego的couterparties包括Credit Suisse（-11.5%）和Nomura（-14%）都暴跌。
估计都是用swaps实现的。
简单解释下吧，股票怎么做swap？
不用想都知道是cfd么。这种体量根本没有margin可以借的。看了一下，感觉这哥们要
坐牢了。
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】
: 实际上就像是OTC forward contract（原理和exchange traded futures差不多）
: https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse-
: archegos
: CFDs - The Dirty Little Secret Behind The Collapse Of Archegos
: Stop us if you've heard this one before - Wall Street prime brokers
allowed
: hedge funds to dance while the music was playing with ever greater
leverage
: in off-exchange and unregulated derivatives... until the first sign of
: trouble and the whole house of cards comes crashing down in a potentially : systemic manner.
: The bloodbath in various media stocks on Friday has brought light back to : ...................
swap几乎不用作filling. 但是这斯肯定有其他违规的地方，这次估计要把他师傅也弄
进去了
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】
: 今天Achego的couterparties包括Credit Suisse（-11.5%）和Nomura（-14%）都暴跌。
: 估计都是用swaps实现的。
这哥们儿也不是第一次违规了
之前因为insider trading被要求不准成立管理public fund
所以他的基金是family fund 至于这钱怎么变成他的family fund估计是个公开的秘密
说实话 其实这些钱在整个市场来说根本引起不了任何系统性风险就是了
CFD总共也就282b的市场 而且不是说CFD在美国是不允许的么
Contracts for differences is an advanced trading strategy that is used by
experienced traders and is not allowed in the United States.
不太明白，如果他不实质拥有股票，liquidate的是谁的股票？
我觉得就是杠杆买多了，又不用报证监会，各债主不知道风险多大。
这种类似对赌协议
我的理解是这样
比如现在Bidu $100
Hwang给GS押金$20
手续费$5
让GS去买bidu (leverage 5x, Hwang does not own any stock)
涨到$120, GS给Hwang $15就可以
如果跌倒$85, Hwang margin call
如果没钱 GS liquidate bidu stock
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】
: 实际上就像是OTC forward contract（原理和exchange traded futures差不多）
: https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse-
: archegos
: CFDs - The Dirty Little Secret Behind The Collapse Of Archegos
: Stop us if you've heard this one before - Wall Street prime brokers
allowed
: hedge funds to dance while the music was playing with ever greater
leverage
: in off-exchange and unregulated derivatives... until the first sign of
: trouble and the whole house of cards comes crashing down in a potentially : systemic manner.
: The bloodbath in variouhttp://www.mitbbs.com/img_rand/img_rand.phps media stocks on Friday has brought light back to
: ...................
美国大银行（资产＞１T）是要报swap的。似乎CFD在美国是不允许的，所以这斯用的是credit suisse and Normura.
【 在 daemonself1 (daemon) 的大作中提到: 】
: swap几乎不用作filling. 但是这斯肯定有其他违规的地方，这次估计要把他师傅也弄
: 进去了
古老的东西。livermore就用过
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】
: 实际上就像是OTC forward contract（原理和exchange traded futures差不多）
: https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse-
: archegos
: CFDs - The Dirty Little Secret Behind The Collapse Of Archegos
: Stop us if you've heard this one before - Wall Street prime brokers
allowed
: hedge funds to dance while the music was playing with ever greater
leverage
: in off-exchange and unregulated derivatives... until the first sign of
: trouble and the whole house of cards comes crashing down in a potentially : systemic manner.
: The bloodbath in various media stocks on Friday has brought light back to : ...................
又为什么是高盛在抛？野村通过在高盛的账户？
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】
: 实际上就像是OTC forward contract（原理和exchange traded futures差不多）
: https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse-
: archegos
: CFDs - The Dirty Little Secret Behind The Collapse Of Archegos
: Stop us if you've heard this one before - Wall Street prime brokers
allowed
: hedge funds to dance while the music was playing with ever greater
leverage
: in off-exchange and unregulated derivatives... until the first sign of
: trouble and the whole house of cards comes crashing down in a potentially : systemic manner.
: The bloodbath in various media stocks on Friday has brought light back to : ...................
最后一步，GS为啥要liquidate自己的bidu stock？
【 在 skibo (你在红楼我在西游) 的大作中提到: 】
: 这种类似对赌协议
: 我的理解是这样
: 比如现在Bidu $100
: Hwang给GS押金$20
: 手续费$5
: 让GS去买bidu (leverage 5x, Hwang does not own any stock)
: 涨到$120, GS给Hwang $15就可以
: 如果跌倒$85, Hwang margin call
: 如果没钱 GS liquidate bidu stock
: allowed
: ...................
当BIDU股价低于85的时候GS就要house call了
hwang没钱补仓那GS必须卖掉BIDU防止自己亏钱啊
【 在 skybluewei (weilan) 的大作中提到: 】
: 最后一步，GS为啥要liquidate自己的bidu stock？
应该是hwang被margin call 需要补钱 所以liquidate大量的中概股仓位 但是leverage太高了 liquidate了也不不上来margin 所以银行expected losses
【 在 coolbid (Dreams bring hopes) 的大作中提到: 】
: 当BIDU股价低于85的时候GS就要house call了
: hwang没钱补仓那GS必须卖掉BIDU防止自己亏钱啊
:
:
: 【 在 skybluewei (weilan) 的大作中提到: 】
: : 最后一步，GS为啥要liquidate自己的bidu stock？
我看到说法是 周四他们谈了下 没达成什么协议 周五高盛二话不说直接block sell 大摩跟上
因为周五是欧洲 日本周六 那边放假了 所以瑞银和木村没有高盛 大摩卖得快 所以被
玩死了
刚看到WFC还有viacomcbs的没卖掉
但是大头应该都卖掉了 高声说自己损失很小。。可想而知卖的第一个
跟电影 margin call一样，高盛跑的最快，然后华尔街遭殃了
太阳底下没有新鲜事，这天底下没有什么股神天才。最近在看关于 一本关于Jim
Simons的书： "The Man Who Solved the Market "，总觉得关键的地方语焉不详，年
化收益40%保持几十年，后面没有猫腻才怪了。
【 在 Yellen (回归财长：印钱加负利率) 的大作中提到: 】
: 实际上就像是OTC forward contract（原理和exchange traded futures差不多）
: https://www.zerohedge.com/markets/cfds-dirty-little-secret-behind-collapse-
: archegos
: CFDs - The Dirty Little Secret Behind The Collapse Of Archegos
: Stop us if you've heard this one before - Wall Street prime brokers
allowed
: hedge funds to dance while the music was playing with ever greater
leverage
: in off-exchange and unregulated derivatives... until the first sign of
: trouble and the whole house of cards comes crashing down in a potentially : systemic manner.
: The bloodbath in various media stocks on Friday has brought light back to : ...................