Starting with a fully invested A-share portfolio to become a capital...

Chapter 251 Betting on China Unicom, Igniting the Price Anchoring Battle

When Xu Xiang also proposed a bet, Zhang Yang did not hesitate and immediately asked Liao Guopei to make a trip and find Lin Qi, a lawyer from Dacheng Law Firm, to continue to act as a third-party supervisor.

With the remote participation of Liao Guopei, Xu Xiang, Ge Weidong, Lin Qi, and Zhang Yang, the "China Unicom Bond Lending Agreement" was successfully signed.

The agreement is roughly as follows...

Lender 1 (Party A): Shanghai Chaos Investment Co., Ltd.

Lender 2 (Party B): Shanghai Zexi Investment Management Co., Ltd.

Borrower (Party C): Liao Guopei.

Witness (Party D): Dacheng Law Offices.

1. Party A and Party B shall each lend 100 million shares of Huaguo Unicom stock to Party C, including 50 million A shares (stock code: 60××50), which is equivalent to 50 million shares in words, and 50 million Hong Kong shares (stock code: 00××62), which is equivalent to 50 million shares in words. The total number of shares lent by Party A and Party B shall be 200 million shares, which is equivalent to 200 million shares in words. The lending price shall be anchored to the closing price of the two stock exchanges on October 30, 2009. The date of the stock lending is: October 30, 2009.

2. The three parties agree that the stock settlement will be conducted on November 30, 2009, based on the closing price of Huaguo Unicom on both the Shanghai and Shenzhen stock exchanges on that day. The stock settlement date is written as: November 30, 2009.

3. The lending fee rate is 8% per annum, with interest calculated daily from the actual lending date and paid in a lump sum upon maturity.

4. Upon completion of this contract, it is assumed that the relevant shares have been sold. Party A and Party B shall, before November 5, 2009 (date in words: November 5, 2009), convert the total value of the shares on the anchor date into Chinese Yuan and remit it to the designated fund supervision account, which shall be supervised by Party D.

5. After this contract is signed, Party C shall, before November 5, 2009 (date in words: November 5, 2009), transfer RMB200 million (in words: RMB200 million) as a security deposit into the designated fund supervision account, which shall be supervised by Party D.

6. If any abnormal outflow occurs in the designated fund supervision account before the delivery date, Party D has the right to apply to the bank for freezing.

7. Upon arrival of the settlement date, Party D shall settle the profits (losses) of Parties A, B, and C based on the closing prices of the two stock exchanges on that day. If the funds in one party's escrow account are insufficient to pay the settlement amount, Party D has the right to apply to the court/bank to freeze all assets under the names of Parties A, B, and C until the funds are sufficient to pay the settlement amount.

8. If you encounter...

Unlike the previous "Shancheng Beer Voucher Agreement", this "Huaguo Unicom Voucher Agreement" includes Shanghai Zexi Investment Management Co., Ltd., and Xu Xiang should be familiar with institutional voucher lending. During the drafting of the contract, he wanted to raise the voucher lending rate to 10%, but Zhang Yang used both soft and hard tactics to reduce it to 8%.

When the 8% lending rate was agreed upon, Ge Weidong felt a pang of pain in his heart. He had no experience and had lent out the loan at 5%, not expecting that the industry standard was generally 8%-12%.

It's worth mentioning that just last night, Apple Inc., located on the other side of the ocean, officially announced the launch date of the iPhone 3GS in the Chinese mainland market, setting it for October 30, 2009, the same day as the first batch of 28 companies listed on the A-share ChiNext board.

In addition to announcing the official date, Apple also specified that China Unicom is the sole authorized distributor of the iPhone 3GS in mainland China.

Less than five minutes after Apple's announcement, China Unicom's official account also posted a statement confirming that it is the sole authorized distributor of the iPhone 3GS in mainland China.

The release of this major news immediately propelled China Unicom to the top of the hot stock list, attracting the attention of countless investors.

With the iPhone 3GS already on the market, the difficulty of gathering information has decreased dramatically. Meanwhile, Zhang Yang's Shengtian Think Tank Capital Intelligence Network, built with an investment of millions, nearly ten million, has also gotten a clear picture of the iPhone 3GS's "details" in advance.

1. The Chinese version of the iPhone 3GS is sold under a contract, requiring a phone plan agreement with China Unicom to purchase the phone.

2. The 16GB version of the 3GS is priced at 3999 yuan, requiring a prepayment of 3000 yuan in phone credit, which will be refunded in 24 monthly installments of 125 yuan each. The 32GB version of the 3GS is also priced at 3999 yuan, requiring a prepayment of 4200 yuan in phone credit, which will be refunded in 24 monthly installments of 175 yuan each. It also requires a subscription to a 128 yuan/159 yuan/199 yuan plan to purchase. Alternatively, if you choose the 888 yuan unlimited data plan and commit to a 12-month contract, you can purchase the phone for free.

3. The model is the version without WiFi.

4. Sales channels include China Unicom stores, Apple stores, Taobao, JD.com, and Suning Appliance stores.

It's clear from the information uncovered that China Unicom is openly trying to use the iPhone 3GS to declare war on China Mobile and China Telecom.

According to the "Statistical Bulletin of the National Telecommunications Industry in the First Half of 2009" released by the Ministry of Industry and Information Technology, as of July 2009, mobile phone users accounted for 70.4% of the total number of telephone users in China, China Unicom accounted for 19.8%, and China Telecom and other operators accounted for the remaining 9.8%.

Although China Telecom's mobile phone business is not very good, its broadband business is far ahead of the other two major operators.

To put it simply, China Mobile dominates half of the mobile phone business, while China Telecom dominates half of the broadband business. Only China Unicom lacks its own competitive advantage.

Perhaps it was precisely to build a strong competitive advantage that China Unicom spared no expense in reaching an exclusive sales agreement with Apple for the iPhone 3GS in the Chinese mainland market.

However, China Unicom overlooked one point: China's software industry simply did not keep up with the development of the iPhone 3GS.

While 3G networks are good, theoretically 10 to 100 times faster than 2G, the problem is that major internet companies haven't had time to deploy mobile networks yet, resulting in an extremely lacking content ecosystem. This is similar to buying a house without considering the surrounding amenities; its price increases can't keep up with those of neighborhoods with prime locations, but its price decreases far outpac those of other properties.

Leaving aside the complicated purchase conditions, the lack of bundled content for the Chinese version of the iPhone 3GS doomed it to a tragic end.

After signing contracts with Chaos Investment and Zexi Private Equity, Liao Guopei, just like last time, first went to Huaguo Bank in Lujiazui to put the "Huaguo Unicom Bond Lending Agreement" into the bank for safekeeping. Then he booked a plane ticket to Sanya and did not return to Zhangjiang Changtai.

Why not go back to Zhangjiang Changtai?
Afraid of being followed.

Caution is the boat.

Having fled to Sanya multiple times, Liao Guopei was quite familiar with the route and had even arranged for a villa manager in Sanya in advance.

This "villa butler" doesn't mean Liao Guopei bought a house in Sanya, but rather that the Sanya tourism company offers a service specifically for wealthy individuals.

With private car pick-up and drop-off upon arrival, you can move into a luxury villa with just your bags. Whether you want to throw a party at night or go on a boat trip during the day, the villa butler can arrange for people to meet your needs, and even take the butler out to sea.

……

Looking at the A-share market's performance in the morning session on October 29th, the siphon effect on market funds by the 28 ChiNext companies nearing their listing became increasingly apparent.

At 9:30 a.m., the Shanghai Composite Index opened sharply lower at 2975.2 points, a drop of 1.85%, while the Shenzhen Component Index also opened significantly lower at 12270.61 points, a drop of 1.88%.

The reason for the sharp drop in the two major indices is simple: the funds locked up after winning the lottery have reduced the liquidity of the A-share market. Coupled with the expectation of "draining funds", cautious funds in the market have withdrawn from the trading.

What is the expectation of blood testing?

Since Guilin Sanjin went public in July, the pace of corporate IPOs has accelerated, with an average of more than a dozen companies going public every month, including blue-chip stocks worth tens of billions of yuan.

The establishment of the ChiNext board is interpreted by many stock market experts as the China Securities Regulatory Commission (CSRC) relaxing the standards for companies to enter the market.

Can a market with a trading volume of less than 2000 billion withstand such turmoil?
obviously.

Many people don't really believe it.

They believe that a large number of companies going public will lead to a depletion of market liquidity and cause the index to fall.

Under these expectations, some funds dare not trade, some funds go to subscribe to new shares, and some funds are keen on hot stocks. The support for blue-chip stocks weakens, and the market naturally falls.

To the surprise of retail investors, despite such a major positive development as the exclusive distributor of the iPhone 3GS, China Unicom's stock price did not rise. The A-share fell by 1.26% to HK$6.28, while the Hong Kong stock fell even more sharply, from HK$10.34 to HK$10.08, a drop of 2.51%.

[Loves Coke]: Was China Unicom set up? Why is it still falling?

[DaXiaBuChiXia]: Exclusive distributor of iPhone 3GS, a clear leader in the concept sector, but it seems like no speculative funds or institutions have entered the market.

[God of All-in]: Speculative funds definitely want to hype it up, but the size of large-cap stocks is too big. Even if Chief Xu, Alliance Leader Zhang, God A and Principal of the Speculators join forces, they may not be able to shake this blue-chip giant.

[Tragic Cousin]: The key is that there are Hong Kong stocks. If you boost A-shares but not Hong Kong stocks at the same time, foreign capital will have arbitrage opportunities. If both markets are controlled together, there must be institutions, or even top-tier institutions, participating together.

[Right eye twitching]: Personally, I feel that it's not that institutions and speculative funds don't want to control the market, but rather that they never expected China Unicom to have such a big move that caught them off guard. They're probably secretly accumulating shares now.

Due to uncertainty about the sales volume of the iPhone 3GS in the Chinese mainland market, coupled with insufficient capital, speculative investors had no desire to participate in controlling China Unicom.

Throwing 1 million into small-cap stocks is enough to drive up the price by several limit-up days.

Throwing 1 million into a large-cap stock like China Unicom, let alone hitting the daily limit, a 2% increase would be the absolute maximum. Moreover, given the current market's cautious approach, making a hasty move would be like stirring up a cauldron with a toothpick—a complete waste of effort.

If speculative capital wants to capitalize on this trend in China Unicom, it can only follow suit.

On the other hand, institutional investors such as Ge Weidong, Xu Xiang, Wang Yawei, and Chang Shishan need more time to accumulate shares. In addition, there is the existence of the "China Unicom Securities Lending Agreement," in which they have all reached an agreement to pump up the price after October 30.

Other speculative funds and institutions have not reached a consensus on driving up the price, and retail investors are hesitant to enter the market because the stock price of China Unicom remains stagnant. This is why the stock price of China Unicom has not risen despite significant positive news.

Witnessing this, Lin Guangchang's eyes flashed with worry, and he whispered, "China Unicom is falling instead of rising. It's obvious that institutions are suppressing the price. We arranged the date for borrowing shares with them two days in advance. The overall risk is just too great."

"The greater the risk, the higher the reward. China Unicom needs a spark right now."

Zhang Yang kept his eyes glued to the screen, showing no sign of panic despite the drop in China Unicom's stock price.

在10月30号下午3点与4点来临前，“张江团伙”对华国联通的预期是上涨，因为协议锚定的时间就是10月30号，这也是iPhone 3GS上市华国内地的时间。

Setting a "stock price anchoring date" two days in advance carries extremely high risk but also extremely high potential returns, as there is a great deal of room for maneuver.

"Clap clap-"

Zhang Yang suddenly clapped in greeting.

Zeng Lingshan, Feng Weiqiang, and Chen Xiaoqun, who were watching the market and trading, all looked up at Zhang Yang, their eyes filled with confusion.

"Put everything else aside and let's steal some last-minute deals today."

Since market funds have not reached a consensus, we need to actively add fuel to the fire, make the stock market hot, and then let the iPhone 3GS inflate the bubble for all funds in the stock market.

How much money are you prepared to invest?

Chen Xiaoqun was already eager to try.

For a large-cap stock like China Unicom, 1 million or 2 million won't be enough. He guessed that Zhang Yang would need to invest at least 5 million or more to see a noticeable effect.

"The 'Two Dragons and Four Phoenixes' will be listed tomorrow, so be sure to keep available funds on hand," Lin Guangchang reminded.

As of 10:49 a.m., Newland had acquired 432 million shares at an average purchase price of 14.49 yuan, with a total purchase value of 6259.68 million yuan. Combined with the original holding of 1361.47 million shares, Newland now holds 1793.47 million shares, with a total average holding cost of approximately 14.65 yuan per share.

Yuanwanggu acquired 266 million shares at an average purchase price of 21.72 yuan, for a total purchase value of 5777.52 million yuan. Combined with its existing holdings of 940 million shares, it now holds 1206 million shares, with a total average holding cost of approximately 21.34 yuan per share.

With 20.7 billion yuan in available funds, 2 million yuan as a margin deposit for a betting match, and after deducting the 1.2037 million yuan raised in the morning, there are still 17.4963 billion yuan in available funds.

Zhang Yang, with his precise control over funds, responded, "There's often a premium on the day of listing. I've reserved 7 million to accumulate shares in two top-performing stocks, and I'll let the four lesser-known ones drop for a while. As for Yuanwanggu and Newland, I've already accumulated enough shares." "You want to use 10 billion to take on China Unicom?"

Lin Guangchang understood Zhang Yang's intentions.

"If 10 billion yuan is used to buy China Unicom at the end of the trading day, it might be able to push up the price by more than 5%," Feng Weiqiang analyzed.

"I think it could hit the daily limit."

Zeng Lingshan also offered his opinion, and then he analyzed: "Tomorrow is the first day of the domestic launch of the iPhone 3GS. There may be other funds trying to steal the last few days of trading and bet on a premium."

“Dropping out of school is a good point. I also feel that there might be other funds that would respond to the rush to buy at the end of the day,” Chen Xiaoqun agreed with a smile.

Zhang Yang revealed a look of "this kid is teachable" and explained his thoughts: "From a funding perspective, it is indeed easier to drive up the price by igniting the market at the end of the trading day, because tomorrow is the launch day of the iPhone 3GS, which is an open secret. Even if we know that this phone is not good, we will not be able to tell on the first day, which opens up room for premium."

"Of course."

"The most crucial thing is to ignite the flames and create momentum."

Now they need to push up the stock price as much as possible and raise the anchor price on the 30th so that they can have enough room for unrealized profits.

Meanwhile, Xu Xiang and Ge Weidong, acting as the opposing side, need to suppress the stock price as much as possible to keep the anchor price low, so that even if the price falls, there won't be much room for profit.

"Everyone get ready. In the last 30 minutes of trading this afternoon, we'll ignite Huaguo Unicom with 10 billion yuan." Zhang Yang repeated the control plan.

"Roger that!"

"Roger that!"

Lin Guangchang, Zeng Lingshan, Feng Weiqiang, and Chen Xiaoqun all responded. The newly arrived "three little ones" had no idea that in just a few days, the amount of money they were managing had reached 10 billion yuan, giving them a feeling of unease and euphoria.

If 10 billion yuan were used to buy steamed buns, it would be enough to feed over a million people to death!
……

at the same time.

The trading area of ​​Zexi Private Equity.

After returning to Zexi Private Equity, Xu Xiang kept a close eye on the intraday chart of China Unicom. He knew very well that "Mr. J" would definitely drive up the stock price to leave him enough room for betting.

When will the market rally?
he does not know.

All he can do is prevent other institutions from accumulating shares significantly today and tomorrow, and allow the positive news to be digested naturally as much as possible.

If Mr. J forcibly pumps the price up, Xu Xiang and Ge Weidong have already agreed to have their own traders dump the shares to control the stock price.

Sun Guodong glanced at the focused Xu Xiang, then looked at Ma Xinqi and said, "Brother Ma, how long has it been since you've seen Brother Xiang this serious? It's like going back to 2004!"

“These past six months have been incredibly tough, from Rhine Biologics to Shancheng Beer. Chief Xu has never suffered so many losses before. I guess it has ignited his fighting spirit,” Ma Xinqi replied.

Humans are inherently lazy; the poorer they are, the more they want to strive, while the richer they are, the less passionate they become.

Just like receiving your first salary, 1000 yuan or 800 yuan is enough to make you happy for days and nights. But as your salary increases, even if you get 5000, 7000 or even tens of thousands of yuan, you no longer feel the same excitement.

Since Xu Xiang attained enlightenment, his path has been incredibly smooth; he makes money almost every time he does something. Ma Xinqi personally witnessed Xu Xiang's post-market analysis time shrink from at least 4 hours to about 1 hour now, indicating that they are leaning towards insider trading.

The biggest difference between institutional investors and speculative capital is the information gap.

Similarly, the biggest difference between speculative capital and retail investors is the information gap.

Big fish eat small fish, and small fish eat shrimp; this is the ecosystem of the stock market.

Many people may think that buying stocks is value investing, but in reality, the vast majority of retail investors have no idea which stocks have long-term investment value.

"Indeed, we've suffered quite a few losses, but Brother Xiang's motto is 'the more we fight, the stronger we become.' In this round with China Unicom, he probably won't stop until he's made over a billion!" Shu Yimin echoed softly.

Although Xu Xiang was focused on watching the market, he wasn't deaf, and naturally overheard his brothers' conversation about him.

Ma Xinqi was absolutely right. His fighting spirit was indeed reignited by Fuchun Road and Mr. J. Since the beginning of 2000, Xu Xiang had never suffered so many defeats.

"Tap tap tap——"

The sound of rapid footsteps came.

Wearing a long black trench coat, the refined and elegant Xu Haiou sat down and looked at Xu Xiang, saying, "I've investigated everything. China Unicom is selling the iPhone 3GS as a contract phone. The unlocked price is 3999 yuan, but the 16GB version requires a 3000 yuan deposit and the 32GB version requires a 4200 yuan deposit, which will be returned in 24 months. In addition, you also need to sign up for a Unicom plan, which starts at 128 yuan per month. It is indeed a bit expensive."

"That's equivalent to buying a phone for 6999 or 7999? Who would buy that?!"

Shu Yimin was starting to lose his composure. With that kind of money, he could have bought more than a dozen Tianyu mobile phones.

Ma Xinqi shook his head and retorted, "There's a reason why things are expensive, and there are customers who appreciate them. Take Hermès and Chanel, for example. Their material cost is 2000 yuan, but they can sell for 2 or even 20 yuan just by putting on a brand label, and they are still sought after all over the world."

"That's right, what you're buying is status and a sense of superiority. Just like the McLaren you bought, a Wuling Hongguang can also get you around. When you buy a McLaren, aren't you also paying for the premium?"

Sun Guodong echoed.

"That's true." Shu Yimin nodded slightly.

Some goods and services are not intended for ordinary people. Once you have more money, you will need high-priced goods or services.

"Also, the iPhone 3GS does not integrate a WAPI module and has not passed the certification of the Ministry of Industry and Information Technology, so it does not support WiFi functionality."

Xu Haiou added.

"No WiFi?" Xu Xiang was taken aback, his brows furrowing immediately.

“Yes, it doesn’t support WiFi,” Xu Haiou responded, then added, “Perhaps the next generation will support WiFi. I feel that whether or not it has WiFi doesn’t matter much; it won’t have a significant impact.”

WiFi penetration was low in 2009, with only a few upscale venues offering it and most people still using mobile data.

Because it's data-based internet access, domestic operators are very "conscientious," charging 5 yuan for 30MB of data. Fortunately, there aren't many places on the 2G network where data usage is needed.

"I hope so."

Xu Xiang had a vague feeling that something was wrong, but he couldn't figure out what it was.

……

1 pm.

A-shares began trading at midday.

During the morning trading session, both the Shanghai Composite Index and the Shenzhen Component Index were firmly held down, showing no desire to struggle.

However, as the midday trading session progressed, bullish funds began to become more active.

2967 points.

2979 points.

2996 points.

In less than half an hour, the Shanghai Composite Index showed signs of breaking through 3000 points.

However, when the turning point arrived at 1:30 PM, the Shanghai Composite Index fell back, forming a doji candlestick pattern with both upper and lower shadows.

The appearance of a doji candlestick pattern has prompted many aggressive investors to enter the market.

1:50 p.m.

2:10 p.m.

2:30 p.m.

The A-share market has gone through a relatively calm "garbage time," with the index neither rising nor falling, and individual stocks also neither rising nor falling, as if they were stuck in place.

However, as the market reached the turning point at 2:30 p.m., China Unicom, driven by positive news, was the first to show unusual activity.

[Stock Anomaly Alert]: A super buy order of 6000 million yuan appeared in China Unicom.

[Stock Anomaly Alert]: A super buy order of 6000 million yuan appeared in China Unicom.

[Stock Anomaly Alert]: A super buy order of 6000 million yuan appeared in China Unicom.

Three super purchases of 60 million each were like a pebble thrown into a calm pond, instantly creating ripples that began to spread.

[Where Did the Panda Go?]: Holy crap! Those bastard big players have finally started pushing up the stock price, three 60 million shares each, are they testing the waters?
[Fishing Guy Doesn't Go Short]: I went in this morning, I knew that speculative funds wouldn't let China Unicom go.

[Southern Lyrics in Northern Tune]: May the stock price rise quickly! If it rises too much, I'll buy an iPhone 3GS to support China Unicom's services!

Retail investors are just waiting for unusual activity; the so-called "ignition" is actually releasing the pent-up buying sentiment of retail investors.

Why do speculative stocks need positive news to drive them?
Positive news is like a bomb; without the bomb, only the fuse, the market cannot continue to rise.

"Finally, I couldn't hold back any longer, Mr. J." Xu Xiang muttered to himself. His hands moved very fast, and he brought up the sell page in less than 0.5 seconds. His eyes were fixed on the stock price, looking for the best time to dump the shares.

Ge Weidong, who was far away at Chaos Investment, was also watching the market. When he saw the unusual movement of China Unicom, he immediately started operating his account and said, "You rat that only hides in the dark, this time you must be punished!"

(End of this chapter)