Double the long positions in the Southern China East Ying leveraged ETF on Hailisi (7709. HK) really has trapped quite a few people.
I just saw a news report: a 26-year-old male employee of “Fortune Management Company” misappropriated HK$50 million, buying 7709, leading to a mark-to-market loss of HK$150 million.
Many people buy leveraged ETFs without really working out this part: if the SK Hynix (stock) price is 100, it rises 10% on day one and falls 10% on day two, bringing the price back to 99—so over two days you lose 1%; but if you buy 7709, after day two you’d be left with only 96, which is actually a 4% loss—the path dependency is very significant.$SKHY
This “Fortune Management Company” and “Fortune Securities” are both companies under “Fortune Group.” Not long ago, many crypto KOLs promoted Fortune Securities.
I just saw a news report: a 26-year-old male employee of “Fortune Management Company” misappropriated HK$50 million, buying 7709, leading to a mark-to-market loss of HK$150 million.
Many people buy leveraged ETFs without really working out this part: if the SK Hynix (stock) price is 100, it rises 10% on day one and falls 10% on day two, bringing the price back to 99—so over two days you lose 1%; but if you buy 7709, after day two you’d be left with only 96, which is actually a 4% loss—the path dependency is very significant.$SKHY
This “Fortune Management Company” and “Fortune Securities” are both companies under “Fortune Group.” Not long ago, many crypto KOLs promoted Fortune Securities.