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Confused? - I certainly am
BBC NEWS | Business | Hedge funds make £18bn loss on VW
How the hell do you make an £18bn loss by borrowing shares from a company then selling them back to the same company only to buy them back at a higher price. No wonder the financial markets are screwed with muppets like these on the case :freak3::lol1: |
Seems very confusing.
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In a nutshell.
Hedge funds sold Volkswagen shares. Porsche then admitted a 74% holding in VW. Hedge funds panicked, and bought their short positions back. Net result - hedge funds flat, VW temporarily the biggest company in the world, and Porsche's reputation reinforced. Cost: $28bn. Ouch. |
Was it not well known that Porsche owned a massive stake in VW?????
I certainly knew it. |
Then you had inside information!! A major stakeholder isn't the same as a 74% holder who can then practically do what they want! And when Porsche said they would "even out" prive movements in VW shares, hedge funds saw that as a clear sign that the price would not be allowed to fall further. So they trampled over each other in the rush to buy back their shorts, driving the price to ridiculous heights.
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I knew Porsche held a vast majority stake in VW as it was discussed at length on another car forum quite some time ago.
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Still don't get it though, who ended up with the £18bn?
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Originally Posted by mrtheedge2u2
(Post 8230982)
I knew Porsche held a vast majority stake in VW as it was discussed at length on another car forum quite some time ago.
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you will find Porsche did...... i think it works such as.... Porsche released shares in VW, hedge fund bought them, the sold them to Porsche, hedge funds bought them back at a higher price and then gave them back to Porsche and then rebought them at a higher price again....... or something like that.
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Frickin hell there are some weapons on here today.
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who is that aimed at??? why is someone a weapon for either a) not understanding the stockmarket, or b) trying to give an answer?
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Originally Posted by bugeyeandy
(Post 8230983)
Still don't get it though, who ended up with the £18bn?
Oct. 29 (Bloomberg) -- BaFin, Germany's financial-market regulator, opened a formal investigation into the trading of Volkswagen AG, Europe's biggest carmaker. The regulator is reviewing ``possible market manipulation,'' BaFin spokeswoman Anja Engelland said in an interview today. Volkswagen shares rose almost fourfold in Frankfurt trading this week after Porsche SE announced that it owns 42.6 percent and has acquired options to increase its stake to 75 percent. The announcement spurred short-sellers to buy from a shrinking pool of stock to close their positions. Porsche, the maker of the 911 sports car, said today it will unwind options equivalent to as much as 5 percent of Volkswagen's shares to ease the so-called short squeeze. It wants to stay ``close to'' its goal of building a 75 percent stake in Volkswagen. Porsche rejects any allegations of market manipulation, Frank Gaube, a spokesman for the Stuttgart, Germany-based company, said in an interview today. That's the latest press release. |
Just people being generally clueless and uninformed about the major issues going on in the world around them, despite having more information at their finger tips than any other generation in human history. And from your posts on this topic, it is def aimed at but not exclusive to you...
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Gonna be honest with you Nat.... I infracted you for that, 1st infraction I have ever given...... just because someone does not understand how the stock market works does not mean they are a 'weapon'.....
feel free to challenge it and if i have given it against the rules then I apologise in advance and will take the infraction myself. |
I'm not bothered, infract away. I'd rather say what i feel than just say what everyone else expects me to say like the majority of posters on here do now because they're so scared of being infracted ON A MESSAGE BOARD ON THE INTERNET (OH MY GOD THE HORROR OF IT) :lol1:
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I agree with you 99% ... but on this one I was just trying to provide an answer to a SNetter..... if you knew better then you should of just told me I was incorrect and explained the correct reason.....
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No worries!
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Still don't get it, must be a thicko.
Nat21 - you ain't helping at all mate :brickwall Does this mean Porsche made £18bn? or not? |
Sorry to go off track here.... but can a person take-back an infraction they gave?
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Nah, just leave it it's my only one, i'll survive ;)
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ok matey
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Originally Posted by bugeyeandy
(Post 8231036)
Still don't get it, must be a thicko.
Nat21 - you ain't helping at all mate :brickwall Does this mean Porsche made £18bn? or not? No. The only thing you can be certain of is that hedge funds lost that amount. And even then, the people who have "made" £18bn might only have done so on paper at the moment, they could well have sold shares they didn't actually own. That's stock markets for you. :) |
Short selling
Establishing a market position by selling a security one does not own in anticipation of the price of that security falling. But it didn't ...... Dave |
how many shares were actually released??????
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About 5%, as per the press release i printed for you :)
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i mean how many actual shares were released..... not a %
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Their market cap is EUR 172bn, given the current share price of 574
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Or if you're still unsure how to use those numbers, there are 294m shares in circulation.
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Telboy, you have the patience of a saint :D
LOL and BOTHERED @ my second infraction on here :lol1: |
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