An Investor Who Sees The Future

I held a second extraordinary general meeting of shareholders.

“The problem was trying to operate a fund of over tens of billions alone.”

It’s not like Warren Buffet raised Berkshire Hathaway alone, or like George Soros operated the Quantum Fund by himself. Whether it’s a holding company, hedge fund, or private equity fund, under the CEO, there exists the best team.

The answer was surprisingly simple.

“Let’s establish an investment company as a subsidiary of OTK Company. We gather the talent we need under us. If I set the investment policy with Yeji at the core, we are creating an organization to execute that.”

The two major shareholders nodded their heads.

“The first talent we need to recruit first is…”

At that moment, Taekgyu’s phone rang.

Ring!

“Turn off your phone during the shareholders’ meeting.”

“Just a moment… Oh!”

Taekgyu, surprised, checked the caller ID.

“Who is it?”

“My older sister.”

Of all times, she called first at this moment.

I told Taekgyu, “Go ahead and answer.”

Taekgyu pressed the call button.

“Hello.”

Before he could finish speaking, a voice came loudly from the phone.

“Where are you right now? Why is the house empty?”

Listening from the side, it seemed he had gone to the old house before the move.

Taekgyu explained with an excuse.

“I moved yesterday.”

“Give me the address.”

“I’m in Samseong-dong…”

After Taekgyu gave the address, Hyunjoo, his older sister, spoke loudly again.

“Don’t you move a muscle and wait there. I’ll be right there.”

“My, my sister is in Korea right now?”

Click!

The call abruptly ended without a response.

Taekgyu looked at me and said, “My sister is on her way here.”

“No need to explain.”

Even though it wasn’t a speakerphone call, I heard everything.

“Well, that’s a relief. We needed to meet Hyunjoo no matter what, anyway.”

“True, but…”

Taekgyu had an uneasy expression.

“She seems really angry for some reason.”

Unlike me, who carefully considers various possibilities and moves cautiously, Taekgyu tends to act quickly rather than think.

He had been in several accidents since childhood, and each time, it was Hyunjoo who cleaned up the mess.

I first met Hyunjoo when I went to Taekgyu’s house in middle school. She was a graduate student following the MBA program at the time.

Even now, she exuded intellectual and beautiful charm in her mid-20s back then.

Growing up as an only child, I envied Taekgyu for having a pretty and cool older sister.

However, Taekgyu gave me a pathetic look after hearing my words.

I realized the meaning of that look after seeing Taekgyu scolded by Hyunjoo. Since then, I understood why he was so afraid of his sister.

I asked Taekgyu, “What did you do wrong?”

“Well, you see…”

Is it too hard to pick just one out of all the things you’ve done wrong?

Not even 10 minutes passed before a taxi stopped in front of the house.

A beauty in a two-piece suit and glasses got out of the taxi. It was none other than Hyunjoo, his older sister.

Taekgyu opened the front door for her, and Hyunjoo entered the house. She looked a bit disheveled, as if she had hurriedly rushed over, with her clothes slightly askew and her hair a bit messy.

“Hey, Taekgyu!”

Taekgyu was taken aback and hid behind me.

“Why, why, sister?”

Although I had seen Hyunjoo angry several times before, it had been a while since I had seen her this mad.

“Jinhu was with you too?”

“Yes.”

Only then did Hyunjoo notice my presence and her expression softened slightly.

“Calm down first and have a seat.”

“Sigh.”

Hyunjoo plopped down on the sofa, and then silently smoked a cigarette for a while. The smoke filled the spacious living room.

Unlike Taekgyu, who detests smoking, Hyunjoo is apparently an avid smoker, having secretly smoked since high school, according to Taekgyu.

*Cough, cough!*

Secondhand smoke isn’t good for the body.

As Taekgyu discreetly stood up to open the window, Hyunjoo spoke up.

“Sit down.”

“Yes.”

Taek-gyu quickly stuck his butt back out.

“What is this house?”

“I bought it. I plan to live here from now on.”

“Explain what happened.”

“What? Why did I buy this house?”

As if Taek-gyu didn’t understand English, Hyun-joo’s gaze turned cold. Taek-gyu shrank his body.

It was like a mouse in front of a cat.

“You don’t know? What about the billions in the account?”

Taek-gyu blinked and asked.

“Is that why you came?”

**”

If you were to pick the biggest recent event in the international financial world, undoubtedly it was the L6 explosion incident.

Following that event, Seosung Electronics and the Korean stock market, which were doing well, plummeted, and the financial companies that issued related derivative products suffered huge losses.

However, a rumor circulated after the incident.

Before the event occurred, a certain entity concentrated on buying Seosung Electronics and KOSPI200 put options and made tremendous profits.

Surprisingly, the entity had an account with Golden Gate Asia, and thanks to it, Asia’s deposit balance increased by over 600 million dollars.

Analysts, fund managers, everyone speculated about the identity of the entity.

It was a rare occurrence to make such profits with derivatives. Naturally, attention focused on it.

It was later revealed that the entity behind the purchases was OTK Company.

Oh Hyun-joo never thought that the incident could be related to her younger brother.

The world is vast, overflowing with paper companies. There were plenty of companies formed by randomly combining alphabets.

She thought it might be one of those companies.

I found out the truth a few days ago. I received a call from a senior colleague who was the manager of the Golden Gate Gangnam branch.

Yoo Sung-moo, the manager of the Gangnam branch, had been handling the transfer of over 10 billion won from overseas corporations to domestic accounts and informed Hyun-joo of the truth.

The account was created for her younger brother to manage, which is why she had the authority to access it.

Oh Hyun-joo logged into the OTK Company account.

Surprisingly, the account balance was over 672 billion won!

At first, she thought she might have mistakenly opened a different account with a similar name. She tried logging in several times, but it was definitely her brother’s account.

Shaken, she nervously typed on the keyboard to review the transaction history. Records of purchasing put options kept appearing.

Forgetting that she was in a company, Hyun-joo suddenly stood up and shouted, her hands trembling on the keyboard.

“Yo Taek-gyu!!!”

—

Noona Hyun-joo pressed her head with her fingers as if she had a headache.

Taek-gyu and I looked at each other with surprised expressions after hearing the story. Has the talk about us spread to Golden Gate as well?

Noona Hyun-joo looked at Taek-gyu and asked,

“Did you really sell the Futures Options for Seong Electronics?”

“Yeah.”

“…”

Even though she already knew, seeing it directly seemed to shock Noona Hyun-joo, who was left speechless.

“Is this such a surprising thing?”

Noona Hyun-joo bit her cigarette and said,

“You’re asking if it’s surprising? Because of that, we have received requests for data submission from the Financial Supervisory Service to Golden Gate.”

“Yes?”

I was taken aback.

Are you really starting an investigation?

“W-what submission of data?”

“We need to hand over the trading history and corporate owner information of OTK Company.”

“S-So? You didn’t hand it over, did you?”

“Even Golden Gate doesn’t know the corporate owner. Only the country where the corporation was established would know.”

Most of the corporations in tax havens are set up for tax evasion purposes, so they are very strict about protecting corporate ownership information.

“All I can provide is account transaction records. Customer information isn’t something we can easily hand over.”

“Still, if the Financial Supervisory Service requests cooperation, it’s hard to refuse, isn’t it?”

Hyunjoo shook her head.

“That’s for domestic financial institutions.”

Unlike domestic financial institutions that readily hand over information at a word from investigative agencies, foreign financial institutions rigorously protect customer privacy. To obtain information, formal approval would likely be needed from a U.S. court.

Taekgyu let out a sigh of relief.

“It didn’t get handed over, thankfully.”

There was one thing I didn’t understand.

“Why did the Financial Supervisory Service request data submission?”

“They’re probably suspecting insider trading.”

“Yes?”

While I was surprised, Taekgyu chuckled and shook his head again.

“What’s insider trading?”

Hyunjoo let out a long sigh.

“Sigh.”

A guy who doesn’t even know what insider trading is made a move that could turn the financial world upside down.

I explained instead.

“It means trading using undisclosed information that could have a significant impact on investment decisions.”

Publicly traded companies must disclose important information to investors. And it’s not allowed to trade using that information before it’s disclosed.

A prime example is the Hanbi Pharmaceuticals incident from last year.

Hanbi Pharmaceuticals, a pharmaceutical company, had both positive news of exporting cancer drugs and negative news of halting new drug clinical trials at the same time.

Hanbi Pharmaceuticals announced the positive news after the market closed the previous day. The next day, as soon as the market opened, trading volume increased, and the stock price rose.

Suddenly at 9:30 am, they announced the negative news. The previously rising stock price plummeted and closed down by 23%.

Due to the sequential release of good and bad news within just 17 hours, the stock price fluctuated over 40% in a single day.

The issue was that certain individuals who had the information and institutional investors sold their holdings before the negative news announcement.

Not only that, but they even engaged in short selling. Early in the market session, short selling volume increased more than ten times compared to usual.

Naturally, individuals who only believed in the positive news announced the day before suffered massive losses.

When the media highlighted this, the Financial Supervisory Service launched an investigation and prosecuted dozens of individuals who leaked undisclosed information and profited unfairly.

“A big crime, right?”

“Indeed, because it undermines trust in the financial market. Once caught, all illegitimate gains will be confiscated.”

In other words, the government reclaiming money earned through illegal acts.

And…

“I heard the penalties are quite severe. Depending on the amount, it could lead to over 5 years in prison.”

“Gasp!”

Taek-gyu’s face became pensive at my words.

“So, what’s going to happen to us? Are we going to be dragged into some strange place for questioning?”

I thought calmly.

Proving insider trading is not an easy task. It requires not only circumstantial evidence but concrete evidence as well. So, during the Hanbi Pharmaceutical incident, institutional investors and short sellers like the big players got away because there was no evidence, only small fish got caught.

Most importantly, it’s crucial that there is no real connection to insider trading.

Hyun-joo lit a cigarette.

“Now explain. Who did you talk to and do this?”

Taek-gyu gestured towards me as if waiting.

“Him.”

Hyun-joo looked at me.

“What does that mean?”

I nodded.

“Taek-gyu is right. I provided the information.”

“Jin-hoo, where did you get the information from?”

“Well…”

What would be the right explanation?

As I hesitated to speak, Hyun-joo grew angry.

“Do you both realize what you’ve done? Insider trading is a financial crime!”

If confirmed as insider trading, the fines could be in the tens of billions, not ending with just a fine.

Considering the possibility of my brother being arrested if proven wrong, it’s natural for her to be furious.

“No, sis. Just listen for now.”

Taek-gyu began explaining what had happened. His story was a total mess, making no sense even to me, who was involved in the operation.

Hyun-joo, who had not heard before, said, “Jin-hoo, you explain.”

“Yes.”

I recounted the events in chronological order.