tag:blogger.com,1999:blog-4815867514277794362.post3641046913125974052..comments2024-03-08T06:18:28.125+11:00Comments on Bronte Capital: Huabao: derivative transactions and disclosureJohn Hemptonhttp://www.blogger.com/profile/03766274392122783128noreply@blogger.comBlogger22125tag:blogger.com,1999:blog-4815867514277794362.post-16258462938329906592012-04-25T00:11:02.612+10:002012-04-25T00:11:02.612+10:00Just read on FT Alphaville, Anonymous Analytics ju...Just read on FT Alphaville, Anonymous Analytics just published a pretty comprehensive destruction job of the queen of cash out...along with a pledge to release the encryption code should any of its people be threatened by the 'real' people behind the pump and dumpMark Tnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-76406273388437950832011-10-23T00:19:39.006+11:002011-10-23T00:19:39.006+11:00Check out what Bridgewater has to say about hedge ...Check out what Bridgewater has to say about hedge funds and their relative worth - http://bit.ly/qY57JXAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-57559129449178865422011-10-22T23:48:12.720+11:002011-10-22T23:48:12.720+11:00any development on Chaoda Modern?any development on Chaoda Modern?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-43712776941598084662011-10-22T10:24:52.974+11:002011-10-22T10:24:52.974+11:00My God I laugh at the retards thinking she might b...My God I laugh at the retards thinking she might be taking long exposure. The move in the underlying stock makes that very clear, and besides, what sort of semi-sensible executive ever INCREASES their exposure to the company that employs them voluntarily. Very few.Pete Dhttps://www.blogger.com/profile/11459449132460797218noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-80552486242356115652011-10-21T15:13:00.252+11:002011-10-21T15:13:00.252+11:00John do you have any opinion on MUCH smaller fragr...John do you have any opinion on MUCH smaller fragrances company, which has recently branched into flavors as well, Ecogreen Fine Chemicals (2341.HK)? I have always wondered about the enormous claimed returns on capital and bizarre capital allocation. Don't know if it's good/bad/ugly.<br /><br />-TexAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-66140455101212194492011-10-21T12:54:05.817+11:002011-10-21T12:54:05.817+11:00Are you committing a crime or have any moral hazar...Are you committing a crime or have any moral hazard right now?<br />You said something about a company with very weak evidence while you are at the same time short selling that stock??? Please explain !!!!!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-75347819511915857802011-10-21T09:52:51.679+11:002011-10-21T09:52:51.679+11:00Cash settled call options taking control of large ...Cash settled call options taking control of large chunks of shares to short squeeze you the Porsche/VW way.<br /><br />Or maybe she went into a derivative transaction regarding you with a triad.<br /><br />Just kidding. If she is a smart cookie, she will have bought protection on her book through put options.Finsternoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-40968528764713062882011-10-21T07:38:23.688+11:002011-10-21T07:38:23.688+11:00I have to agree with the last contributor. The pri...I have to agree with the last contributor. The price action is a clear indicator of direction. The only question is whether the transaction is a put option or a short forward. Given the size of the price movement, I suspect that the deltas are rapidly converging and (assuming that the put was bought "at the money") there is now effectively little difference between the two. <br /><br />The puzzle for me is the identity of the cowboy who would stand on the other side of such a transaction. They are probably not very happy at the moment.Richardnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-87903985472607102932011-10-21T06:57:12.479+11:002011-10-21T06:57:12.479+11:00"In my world all derivatives can be bifurcate..."In my world all derivatives can be bifurcated into a series of forwards, put options and call options. (The bifurcation is alas not unique...)"<br /><br />Isn't that a "trifurcation"? Sorry...couldn't resistAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-82399472673636629352011-10-21T06:11:49.291+11:002011-10-21T06:11:49.291+11:00Why not short the tobacco SOE as well?
I've n...Why not short the tobacco SOE as well?<br /><br />I've never actually heard of a fund shorting a listed SOE, does this happen? Or is there an assumption that they have infinity cash?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-4379408351623971182011-10-21T02:51:33.945+11:002011-10-21T02:51:33.945+11:00What is the best way to search for chinese frauds ...What is the best way to search for chinese frauds on the HKEx? For US listed chinese companies, there is a good stock screener http://www.fixyou.co.uk/index.php. <br /><br />Is there anything like this for hong kong?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-74145781790904358192011-10-20T23:49:09.718+11:002011-10-20T23:49:09.718+11:00If she things the company is in trouble, wants to ...If she things the company is in trouble, wants to retain control, then a monetization is the best bet; a nice little forward sale, allowing here to keep notional ownership but reducing her capital commitment. Bet you a fiver that she's done with several countparts...<br /><br />CraftyFrozen in the Northhttps://www.blogger.com/profile/04901959687094626879noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-80815033711574935152011-10-20T23:04:47.465+11:002011-10-20T23:04:47.465+11:00J, your implicit assumption is that she is has ini...J, your implicit assumption is that she is has initiated an effectively short/hedged position, which is understandable given the not so unambiguous wording used in the filing.<br /><br />This might help:<br />Nomura Comment: We believe that the chairwoman's long position is positive for the shares. Based on our conversations with <br />management, Ms Chu chose to take a long position via derivative transactions rather than buy shares directly because it could <br />leave the chairwoman more flexibility to take a positive position on Huabao's shares in the next 15 months. According to <br />regulations, the controlling shareholder cannot increase their stake by more than 2% in one year otherwise it would trigger a <br />general offer. Note that the chairwoman already increased her stake by 0.7% in Sep 2011. However, through the derivative <br />transaction, any shares of Huabao she buys won't be under her name. Based on the terms of the derivative, Ms Chu can buy <br />3% of outstanding shares in the 15 months. If based on today's closing price, she would use at least HKD414mn. <br />We believe that this means the chairwoman remains positive with regards to the company's fundamentals.<br /><br />cogitatorAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-80442776013726254822011-10-20T21:38:39.886+11:002011-10-20T21:38:39.886+11:00I wonder if you can actually cut down on a huge ch...I wonder if you can actually cut down on a huge chunk of your own work, John, and just short en masse stocks that company's own management is selling (straight or via derivatives).<br />They normally have that work done for'ya when they execute that :)))<br /><br />Regards,<br />Dmitry.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-86038887452977766702011-10-20T19:10:44.357+11:002011-10-20T19:10:44.357+11:00Clearly the derivative involves an exposure to the...Clearly the derivative involves an exposure to the stock price that is short, not long, as it is being used to explain a massive sudden *drop* in the stock price - ie, whoever is the counterparty had to hedge the derivative by selling, not buying. Very interesting, and the failure to provide details is super dodgy.<br /><br />The stock has tanked a long way already but I suspect that a substantial part of this company's supposed business doesn't actually exist! I spoke to a fund manager today and mentioned this to him, and it turns out that he actually met with Huabao around 3 years ago and asked to inspect their factories, and he said that there was simply nothing there, nothing going on - they gave some kind of sketchy excuse about the factories just happening to not be running at the time of his visit.<br /><br />I can't wait to see how much further this stock drops.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-15124184597335169832011-10-20T19:09:54.345+11:002011-10-20T19:09:54.345+11:00http://www.china.org.cn/business/2011-10/14/conten...http://www.china.org.cn/business/2011-10/14/content_23626245.htmAndrewnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-41800694645400372912011-10-20T17:01:21.958+11:002011-10-20T17:01:21.958+11:00Maybe it is an OTC equity swap?Maybe it is an OTC equity swap?Eaststopperhttps://www.blogger.com/profile/16903639886157996151noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-38711722290336514562011-10-20T16:01:41.896+11:002011-10-20T16:01:41.896+11:00Tom - looks like its a large American non-cephalop...Tom - looks like its a large American non-cephalopod bank.Nemo Incognitohttps://www.blogger.com/profile/07345185457108156269noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-38207268289141395802011-10-20T14:07:13.350+11:002011-10-20T14:07:13.350+11:00Would it be too surprising if the counterparty of ...Would it be too surprising if the counterparty of the trade is Huabao itself?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-54652861459567793542011-10-20T12:47:56.485+11:002011-10-20T12:47:56.485+11:00That's a very unclear statement, but doesn'...That's a very unclear statement, but doesn't it read as if she'd bought instead of sold via the derivatives market? Or maybe it reads "all your base are belong to us."<br /><br />ptuomovAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-73551446425377476332011-10-20T10:27:41.895+11:002011-10-20T10:27:41.895+11:00While the press release doesn't exactly inspir...While the press release doesn't exactly inspire confidence, it's not completely clear to me that "derivative transaction...relating to a long position" necessarily means an <i>offsetting</i> transaction. Couldn't it mean for example that she purchased call options outright? Or sold puts? Seems improbable but the language is not as clear as you suggest!Jhttps://www.blogger.com/profile/13414667979184626760noreply@blogger.comtag:blogger.com,1999:blog-4815867514277794362.post-22003838903432735792011-10-20T09:30:45.312+11:002011-10-20T09:30:45.312+11:0013 January 2013 is not an exchange-traded option e...13 January 2013 is not an exchange-traded option expiry date. I wonder who the counterparty is.Tomnoreply@blogger.com