Short Selling Henglong (1)

Zhao Chen quickly changed the subject. "There's one more thing I'd like to ask you to help with."

"Go on."

"Once something happens to Henglong and its share price crashes," Zhao Chen said slowly, "there will definitely be Panic Selling in the market. At that point, I'll need some additional funds to pick up the shares retail investors dump at the bottom. Not much—just enough to raise my stake above 15%."

Zhang Qingxue immediately understood his intention:

"In other words, you want to acquire another 5% on the Secondary Market? You want to seize control of Henglong?"

"Yes!" Zhao Chen said solemnly. "I'll use what they throw away in panic to build my wall again."

Zhang Qingxue studied him deeply. "That will take quite a bit of money, won't it?"

"It's too early to say." Zhao Chen said. "It depends on how far the share price falls. But the funding channels need to be prepared in advance."

"I'll keep an eye out," Zhang Qingxue promised. "If there's suitable mezzanine financing or a short-term bridge loan, I'll secure the credit line ahead of time."

At this point, everything that needed to be discussed had been covered.

Zhang Qingxue checked her watch and rose to her feet. "I have another meeting at three-thirty, so I need to go. You... be careful. If anything happens, call me anytime."

"You too." Zhao Chen stood up. "The fog is thick on the road. Drive slowly."

Zhang Qingxue picked up her Briefcase. When she reached the door, she turned back to look at him once more.

The young man stood alone in the dim yellow light of the Cafe, his figure made somewhat lonely by the boundless thick fog beyond the window, yet his back remained perfectly straight.

She remembered Qin Suyun's last request, and complicated emotions surged through her—heartache, worry, but more than anything, a solemn sense of witnessing something unyielding break through the earth.

In the end, she said nothing and pushed open the door, walking into the fog.

Zhao Chen sat back down and looked out the window.

The thick fog showed no sign of dispersing. Instead, it grew heavier, wrapping the entire world in a hazy grayish white.

He took out his phone and logged into his Swiss Bank account.

The long string of numbers displayed on the screen represented 280 Million Hong Kong Dollars in cash.

He took a screenshot, logged out, and opened the calendar.

Today was November 9th.

There was one month until his father was taken away.

One month until Henglong's share price crashed.

One month until his first true counterattack in this life.

He turned off his phone screen, picked up the coffee that had gone cold, and drained the last bitter mouthful in one gulp.

The icy liquid slid down his throat, making him even more clear-headed.

The board had already been set.

The hunter had entered the forest, unaware that he had long become prey in the eyes of a more patient hunter.

And now, the hunter was about to close the net.

He stood up, walked out of the Cafe, and stepped into the all-encompassing fog.

His figure was quickly Devoured, disappearing from sight.

Only the river wind blew through the gaps between the buildings, letting out a low mournful wail like the breathing of some enormous beast before it awoke.

November 16th, Wednesday.

At 9:22 in the morning, the office buildings of Central, Hong Kong were still slumbering beneath the thin mist over Victoria Harbour, but rows of screens had already lit up in the trading room.

Zhao Chen sat at the desk in his hotel suite, three monitors spread out before him—on the left were Henglong Holdings' real-time quotes, in the middle were Hang Seng Index Futures, and on the right was the trading interface for his UBS Bank Offshore Account.

Outside the window, the lights on the far bank of the Jialing River blurred into indistinct patches in the thick fog.

He took a sip of Black Coffee that had already gone cold, his eyes fixed tightly on the screen to the left.

Henglong Holdings: Opening Price, HK$10.52, down 0.3% from yesterday's close.

To Zhao Chen, the numbers Jumped across the screen were no longer mere price fluctuations, but the prelude to a war following meticulous calculation.

A market capitalization of HK$4.2 billion and 55 million shares in Short Positions—this was the position size he intended to build over the next dozen or so trading days, equivalent to 13.7% of the company's total outstanding shares.

It was an extremely dangerous figure, already close to the regulatory red line for Short Selling in the Hong Kong Stock Market.

At that moment, Zhang Qingxue walked in. She had sent Zhao Chen an encrypted file:

"The Xi Family's counterparties have confirmed:

1. Morgan Stanley Asia Derivatives Department — TRS limit of 15 Million Shares, quoted annualized rate of 9.8%

2. Credit Suisse Hong Kong Structured Products Department — TRS limit of 13 Million Shares, quoted annualized rate of 10.2%

3. Singapore Hedge Fund 'Graystone Capital' — CFD limit of 18 Million Shares, quoted annualized rate of 11.5%

4. Goldman Sachs Asia Private Equity Department — TRS limit of 12 Million Shares, quoted annualized rate of 10.0%

Total available limit: 58 Million Shares, exceeding the target by 3 Million Shares."

"But Xiao Chen," Zhang Qingxue said worriedly, "I have to remind you that 58 Million Shares account for 14% of the Circulating Supply. If the Stock Exchange detects anything unusual, it could trigger a Regulatory Inquiry. Have you considered reducing the scale?"

Zhao Chen patted the hand she had placed on his shoulder, signaling for her not to worry.

"Stick to the original plan. Spread them across the Xi Family, keeping each position below 5% of the Circulating Supply to avoid triggering single-counterparty disclosure requirements. Today, we'll sign with Morgan Stanley and Credit Suisse first—8 million shares of TRS each."

He knew he was walking a tightrope.

A short position of 58 Million Shares, with a notional principal of 560 million Hong Kong Dollars, would require 280 million after applying 2x leverage—almost all the cash he had obtained through pledging.

If the stock price rose instead of falling, every 10% increase would require him to post an additional 56 million in margin.