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On an otherwise good stock market day, the share price of the two media groups Discovery and Viacom inexplicably plunged by more than 27 percent on Friday night.
Saturday could Bloomberg tell that the investment bank Goldman Sachs had sold off shares for around 10.5 billion dollars, equivalent to 90 billion kroner, in a so-called block trade before the market opened.
Later, the same newspaper reported that the major bank Morgan Stanley had also sold shares for around 13 billion dollars, or 112 billion Norwegian kroner.
A block trade is the sale of a large number of shares outside the open market. The banks had sold off large amounts of shares in Discovery, Viacom, and among others the Chinese companies Baidu and Tencent, but there was nothing about who they sold the shares on behalf of.
Would satisfy god
On Sunday, several American media reported that the background for the mass sale was that the hedge fund Archegos was forced to liquidate several of its positions in the market. The fund is led by Bill Hwang, a so-called “tiger cub” or “tiger cub” due to the background from the mythical hedge fund Tiger Management.
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Another “tiger cub” is the Norwegian hedge fund manager Ole Andreas Halvorsen, who also goes by the nickname “Tiger boy”.
The shares are said to have been sold at a large discount, and led to the companies involved shaving the market value by 33 billion dollars, equivalent to 284 billion Norwegian kroner.
The hedge fund’s website is unavailable and no one from the company has responded to US media inquiries. Archegos is an ancient Greek word meaning “prince” or someone who takes leadership, and is often used in connection with Jesus.
Hwang’s Christian faith is an important foundation for his investment philosophy and according to an interview from 2018 is he concerned with asking the question: “Where can I invest to satisfy our god?”.
Great uncertainty among investors
On the other hand, Hwang’s insider trading in Chinese bank shares at the end of the 2000s was not particularly Christian. In 2012, he was sentenced by the American Financial Supervisory Authority Sec to pay 44 million dollars after the insider trading was revealed.
According to Financial Times the fund manages its own money and does not have outside investors. Nevertheless, mass sales have led to large losses for other investors in the affected companies.
There is now great uncertainty among investors as to whether Archegos’ positions are closed, or whether the sale will only continue next week and lead to even greater losses.(Terms)Copyright Dagens Næringsliv AS and / or our suppliers. We would like you to share our cases using a link, which leads directly to our pages. Copying or other form of use of all or part of the content, can only take place with written permission or as permitted by law. For additional terms look here.
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