Hong Kong Island. Mid-Levels Villa!
In Huang Lixing’s reception room, Li Yi finally met with the securities firm’s representative and the trader.
There were three of them: two men and one woman!
After they met, Huang Lixing turned directly to Li Yi and said, “Brother, these are all members of the Far East Association. I have a very good relationship with their boss, and they’re all people you can trust!”
Li Yi suddenly asked, “Old Huang, are you referring to Chairman Li, the founder of the Far East Association?”
“Brother Li Yi, you know Chairman Li too?”
“I’ve heard of him!”
Who doesn’t know the first chairman of the Stock Exchange? It’s just that Chairman Li was born at the wrong time—just one year after taking office, he faced the October 1987 stock market crash.
At the time, his response was to announce a four-day market suspension. However, on the first day of trading after the suspension, the market plummeted by 30%, setting a record for the largest single-day drop at the time.
Left with no other choice, he resigned in November of the same year.
To make matters worse, two months later, he and several other senior exchange officials were arrested by the ICAC and charged with accepting shares from listed companies as kickbacks for facilitating their listings, resulting in a four-year prison sentence.
“Since Brother Li Yi knows Chairman Li, he must be aware of the power of his Far East Club!” Huang Lixing said.
Li Yi nodded, indicating he understood!
The Far East Club was the securities trading firm founded by Chairman Li before he became Chairman of the Stock Exchange; it is currently the largest and most powerful securities trading firm aside from Hang Seng, and its strength goes without saying.
It is also worth noting that Hang Seng, the Far East Exchange, the Gold and Silver Securities Exchange Limited (established at the initiative of the Board of Directors and Supervisors of the Gold and Silver Exchange), and the Kowloon Securities Exchange Limited were collectively known as the four major securities exchanges on Hong Kong Island.
It wasn’t until April 2, 1986, that these four exchanges merged to form the Hong Kong and Shanghai Stock Exchange.
Huang Lixing then turned to the two men and one woman standing beside him and said, “This is Mr. Li, a brother with whom I’ve shared life-and-death bonds. He’ll be discussing some matters with you shortly, and you must cooperate fully!”
“Yes, Mr. Huang!”
After saying this, Huang Lixing left the reception room, leaving the room entirely in Li Yi’s hands.
Li Yi looked at the three people in front of him and said, “Why don’t you all start by briefly introducing yourselves?”
The middle-aged, heavyset man spoke up immediately: “Hello, Mr. Li. I’m Zhang Qiusheng, Senior Manager at the Far East Club!”
“Hello, Mr. Li. My name is Lan Xinyi, a top-tier trader at the Far East Association!” said the only woman among the three.
“Hello, Mr. Li. My name is Zhang Jianxi, a top-tier trader at the Far East Club!”
Li Yi looked at the two star traders, then finally fixed his gaze on the female trader named Lan Xinyi.
“Miss Lan, you don’t look very old. Could you tell us about your track record?”
Knowing that Li Yi was Huang Lixing’s guest and brother, Lan Xinyi didn’t dare to be disrespectful and hurriedly replied, “Mr. Huang, I’ve been in the industry for five years. I’ve served as an investment advisor or portfolio manager for 1,987 clients, with a profit rate of 72%. I’m currently one of the top five traders at the Far East Club in terms of performance!”
“Additionally, my team currently consists of eight members, all of whom are experienced traders.”
Hearing that her profit rate was as high as 72%, Li Yi was somewhat taken aback.
This meant that out of every 100 people who followed her advice or entrusted their funds to her, 72 made a profit.
“Mr. Zhang, what about you?” Li Yi turned his gaze to the other trader.
“Mr. Li, I’ve been in the industry for nine years and have over 3,000 actual trading experiences under my belt, with a profit rate of 57%! My team consists of eight members, all of whom are highly capable.”
Hearing these two men’s track records, Li Yi couldn’t help but nod. Although the profit rates they mentioned differed from the investment returns discussed decades later, this did not negate their excellence.
In the securities market, their track records were indeed top-tier!
“If I were to hire both of you as my traders right now, what investment advice would you give me?” Li Yi asked again.
Zhang Jianxi replied immediately, “I would recommend specific stocks or futures based on the size of your investment!”
“What about you, Miss Lan?”
Lan Xinyi thought for a moment and said, “I have no suggestions. I’ll follow your instructions!”
“Clap, clap, clap!”
Li Yi clapped his hands and said, “Miss Lan, I’m very satisfied with your answer. From now on, you and your team are my traders. Mr. Zhang, you may go!”
Although Zhang Jianxi felt a bit resentful, he said nothing and simply turned and left.
Li Yi then turned to the middle-aged, heavyset man standing nearby.
“Manager Zhang, I’d like to know just how much authority you, as a senior manager, have. Is it worth my while to entrust this deal to your company?”
Zhang Qiusheng hurriedly asked, “I wonder how much capital you plan to invest?”
“No less than 40 million Hong Kong dollars!”
Upon hearing this, both Zhang Qiusheng and Lan Xinyi, standing nearby, couldn’t help but swallow hard.
Forty million Hong Kong dollars—that was an astronomical sum.
Even though they dealt with securities on a daily basis, they rarely encountered such a massive sum.
“Mr. Li, what exactly do you mean by ‘authority’?”
“Leverage!” Li Yi uttered the two words matter-of-factly.
Zhang Qiusheng immediately understood: Li Yi intended to use leverage for venture capital investments, and the amount of leverage he could offer depended on the client’s account management authority.
“Three… no, five times. That’s the highest leverage I can offer!”
Li Yi thought for a moment. Combined, his and Huang Lixing’s funds totaled roughly 42 million. With 5x leverage, that would mean over 200 million Hong Kong dollars in trading capital—a substantial sum.
“Alright, so how are the fees calculated?”
“Two ten-thousandths!”
“The trading period is two months, with a flat fee of 500,000. Additionally, I’ll give each of you an extra 100,000 as a bonus, and 50,000 to each team member!”
Li Yi was familiar with futures commission structures, which typically consist of two parts: the exchange portion and the brokerage portion. The brokerage portion is negotiable.
As for how much they could be reduced, that would require negotiation with a futures advisor or manager.
Many investors feel their commission rates are too high simply because they haven’t established a relationship with a futures manager and haven’t requested a reduction—so naturally, they’re charged the standard rate.
But the trading volume Li Yi was about to execute was enormous. If charged at the standard rate, it would amount to a massive sum, so he had to negotiate this price.
However, Zhang Qiusheng and Lan Xinyi, standing nearby, were completely baffled; they had truly never seen anyone negotiate fees like this before.
Wait, are you really haggling over this?
The company takes 500,000 in commissions, and the two of them each get an extra 100,000, all for just one month’s work…
The two felt like this was a stroke of luck!
Without a moment’s hesitation, Zhang Qiusheng nodded and said, “Then let’s do as you say, Mr. Li!”
“Great!”
Li Yi continued, “You should know the rules of the job. Once you’re on the job, you must maintain no contact with the outside world for the entire duration of the contract. Can you do that?”
“We can!”
“Good. You may go now. Bring everyone here tomorrow morning, and we’ll officially get started then!” Li Yi said.
“Yes!”
……..