He was called one of America’s greatest traders.
Bill Hwang founded a company called Archegos Capital Management and entered into contracts with financial companies for total return swaps and arbitrage transactions.
I lost money while investing with 5x leverage.
In March 2021, the stock of ViacomCBS (now Paramount Global), which Archegos had heavily bet on, plummeted.
Archegos had a margin call due to insufficient margin, and if Bill Hwang had taken the loss and made a stop loss, there would have been no downfall.
While investing money to somehow hold on, other stocks (Discovery, Viacom, Tencent, etc.) also fell, resulting in a series of margin calls.
Credit Suisse, Nomura, Morgan Stanley, and UBS, which lent money to Archegos, suffered a total loss of over $10 billion.
Among these, Credit Suisse, which suffered the greatest losses, eventually went bankrupt and was acquired by UBS.
Bilhwang was found guilty today on 10 criminal charges, including wire fraud, securities fraud and market manipulation, and was sentenced to 18 years in prison.