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One of the greatest hidden property in the world will be wiped out in a few days

(Bloomberg)-From a perch just across from Carnegie Hall and just above Midtown Manhattan, Billfan quietly built one of the world’s largest fortunes. Few people even noticed him on Wall Street-until suddenly, everyone noticed. Fans and his private investment firm, Alkegos Capital Management, are now at the heart of the largest margin claims in history-the billions of dollars, including dangerous leverage and instantly rewound secret market bets. Failure Collected from stocks recently dumped by banks (ViacomCBS Inc., Discovery Inc. GSX Techedu Inc., Baidu Inc.), everything soared this year and could confuse traders who couldn’t understand why. .. From Friday, Goldman Sachs Group Inc., Morgan Stanley, Wells Fargo & Co. Of the fan portfolio traded in blocks by, it was worth about $ 40 billion last week. Bankers believe that Arquegos’ net worth (essentially fan wealth) has exceeded $ 10 billion. And as disposals continue to emerge, estimates of his company’s total position continue to rise: tens of billions of dollars, 50 billion dollars, and even more than 100 billion dollars. It evaporated in just a few days. “This must be one of the biggest losses in personal wealth in history,” said Mike Novogratz, a former Goldman Sachs partner and career macro investor who has been trading since 1994. “. In a statement in an email, Karen Kessler, a spokeswoman for the company, said in New York that Arquegos broke the days of silence in this episode. “All plans are being discussed as Mr. Huang and his team decide on the best path for the future.” The cascade of transaction losses echoed from New York to Zurich, Tokyo and beyond, with countless questions including big questions. I’m leaving unanswered questions. Has anyone taken such a big risk and is being promoted by so many banks under the nose of regulators around the world? Some of the answers need to be set up as a family office with limited oversight by fans, adopting financial derivatives and disclosing them. Another part is that global banks have accepted him as a lucrative client, even though records of insider trading and market manipulation attempts 10 years ago pushed him out of the hedge fund business. Hedge Fund Legendary Disciple Julian Robertson, Son Cook “Billfan accuses insider trading and manipulation of Chinese bank stocks after resolving SEC civil lawsuits in 2012, then Tiger Asia Management and Tiger Asia The partner was closed. Fans and companies paid $ 44 million and agreed to be locked out of the investment advisory industry. He soon opened Archegos, the Greek word for “leader,” as a family office. I built it. One property is typically exempt from registering as an investment adviser with the US Securities and Exchange Commission. Therefore, you do not need to disclose the owner, executives, or the amount you control. A rule designed to protect outsiders who invest in a fund. This approach makes sense for small family offices, but even if it grows to the size of a hedge fund whale, it can in turn pose a risk to outsiders in a wider market. “Tyler Gerash, a former SEC aide who currently runs the Healthy Market Trade Group, said. “The question is, why do we care if it’s just friends and family? The answer is that they can have a significant impact on the market, Dodd. Even after Frank, the SEC’s regulatory system does not clearly reflect that. ”Valuable Customer Archegos has established trading partnerships with companies such as Nomura Holdings, Morgan Stanley, Deutsche Bank AG and Credit. Swiss Group AG. For some time after the SEC proceedings, Goldman refused to deal with him for compliance reasons, but forgave him because his rivals benefited from meeting his needs. One of the reasons is that fans have never submitted a 13th floor report on their holdings. This report must be completed by all investment managers holding over $ 100 million in US stocks at the end of each quarter. This is because he uses total return swaps to compose transactions and basically appears to be in a position on the bank’s balance sheet. Swaps also allow investors to add more leverage to their portfolio. For example, Morgan Stanley and Goldman Sachs are listed as the largest holders of GSX Techedu, a Chinese online tutoring company that has been repeatedly targeted by short sellers. Banks may own shares for a variety of reasons, including hedging swap exposures from transactions with customers. Overall, the bank reported holding at least 68% of GSX’s outstanding shares, according to a Bloomberg filing analysis. The bank owns at least 40% of Chinese video entertainment company IQIYI Inc and 29% of ViacomCBS, all of which were heavily funded by Archegos. Electronic trading company Virtu Financial Inc. Doug Cifu, CEO of Bloomberg, said in an interview on Bloomberg TV on Monday. He predicted that regulators would consider “should we increase transparency and disclosure by family offices?” Fans’ strategies and achievements remained secret from the outside world unless they needed to sell his money to outside investors. Even if his fortune swelled, his fifties remained unobtrusive. Despite working for Robertson’s Tiger Management, he was not well known in Wall Street and New York’s social circles. Fan is a councilor of Fuller Theological Seminary and co-founder of the Grace and Mercy Foundation, whose mission is to serve the poor and oppressed. According to the latest filing, Foundation assets are approaching $ 500 million at the end of 2018. “It’s not just money,” he said in a rare interview with a 2018 Fuller Institute executive. His calling as an investor and his Christian faith. “It’s long-term, and God certainly has a long-term view.” His extraordinary wealth changed early last week when ViacomCBS Inc. announced a secondary offer of its shares. .. The next day, stock prices fell 9%. The value of other securities that appear to be in the Arquegos portfolio based on block-traded positions had fallen 27% by Thursday’s closing price. Clearing investors’ stocks, which market participants estimate to have leveraged six to eight times, has also hit some of the banks that served their fans. Nomura and Credit Suisse warned of a “significant” loss after the sale, and Mitsubishi UFJ Financial Group pointed out a possible loss of $ 300 million. “We need to wonder who else is in one of these invisible assets,” he said. Novogratz. “All psychology that leverages without risk management, it’s almost nihilistic.” (Updated in the latest bank to elaborate on exposure in the penultimate paragraph.) 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