Archegos – another failing of regulators and an opportunity for trading.

I’ve not posted yet about this although this has been going on for a few days. What am I talking about? Another failure in my view of regulators.

Bill Hwang, Arhegos founder spent Thursday trying to unwind billions of dollars of market bets. This caused HUGE falls in stocks. One of which I’ve just bought BIDU. This is not the first time Bill’s failings have affected markets.

If someone hits you with a baseball bat. You don’t then go back for more and yet that’s exactly what happened. It’s the housing crisis again in a small way but one that will cost the banks billions.

In 2012 Bill Hwang pleaded guilty to insider trading of Chinese bank stocks and agreed to pay over $44 million to settle civil allegations. With that in mind, it’s completely farcical that he managed to convince banks to work with him. Thursday’s huge drops in certain stocks have opened some interesting trading opportunities as we all know the stocks will recover.

I have just gone long on BAIDU one of the stocks affected. I buy stocks when they are in trouble. (You know, when everyone else is shouting SELL) and the chart adds up – so the stock is at a natural low point.

I am amazed how many traders seem to buy into things when they are already high, then look shocked and amazed when their “Too the moon” trade, turns out to be a submarine.

BIDU Baidu $216.66 buy-in – Take profit at $325. The recovery has already begun.

Where were the regulatory agencies? Busy chasing innocent cryptocurrencies instead of doing their job.