A Wall Street Genius's Final Investment Playbook-Chapter 49

Skeptics scoffed upon reviewing the investment report.

[It's a mirage;;;]

— No sales and no basis in cash flow at all;;; -And look at the nerve of this non-expert spouting nonsense. Have you even read it?

There was some merit to the skeptics' arguments. Genesis is essentially a company with no sales. No matter how good the clinical trial results are, it’s only in Phase 2. There’s still no guarantee of drug approval………………

A valuation of $400 is excessively high for a company without sales or products.

However, there were reasons for professional analysts too. Genesis was a special case.

<The clinical results of OCA are very unusual. It's rare to secure such effectiveness that early termination could be declared ・・・・・・>

Firstly, the trial results were too good. There are many students who finish exams with excellent marks, but only a handful are certain of passing after seeing only half of the test. Such special cases cannot be judged by the same standards as ordinary top students.

<10% of the adult population has NASH. Moreover, OCA has high potential efficacy against liver fibrosis and Hepatitis C……………>

Above all, the potential market was enormous. Non-alcoholic steatohepatitis is more dangerous than typical fatty liver, involving ongoing inflammation. Such inflammation can lead to liver fibrosis and cirrhosis, and once it progresses to that stage, there’s no treatment except transplantation.

But what if OCA is safely launched? It would open new horizons in treating with medication instead of transplantation surgeries. As the first of its kind, the first-mover advantage would be significant. This would virtually monopolize a huge market that encompasses 10% of the total population.

One analyst said, "OCA's success is akin to one company monopolizing the diabetes treatment market." With such market potential, extra points were inevitable.

But, Even then, surpassing $400 just doesn't make sense. Even considering such factors, it was still seen as overvalued. Considering that major pharmaceutical companies' stocks were priced between $30 and $50.

— Mark is at 50, and this unknown stock is at 400 kk -Too much praise………… Suspicious

-Are there any experts? The ROI is 300% now, should I sell?

-A great depression is coming soon, get out!

— Run fast kk First come, first serve. Really This frenzy will soon die down. Investors will come to their senses and a crash will soon follow.

Despite such predictions,

$387.98

$388.01

The predictions missed. Genesis’ stock fluctuated slightly during the day but then sharply rose again, nearing the $400 mark. All Wall Street banks had almost reached the target price indicated in their investment reports.

What was even more surprising was that this surge happened in just one day.

-Insane defense kk -They said it would crash!!! They said it would crash!

-In one day, from 71 to 390

-Ah, I’m dizzy

-I should have joined in too. It’s still going to rise.

While the cautious regretted, those who had boarded this madness earlier cheered. Meanwhile, inside Goldman, it was almost like a festival, as most had joined this crazy rush.

"It's insane!"

"Wow, I can't believe what I’m seeing."

"I jumped in midway and still doubled easily."

Despite some regrets about joining late, the profits were sweet. Among those who moved quickly, some had achieved incredible results.

“Someone in the tech department made over $100,000?”

“Faber, that guy literally screamed.”

“He started with $55,000 at the low point…………… Eek! $360,000?”

"It's screwed up……."

"Yeah, if we had only entered from the beginning……………"

The chatter of those talking dwindled. They had just remembered another person who had invested their entire amount from the start.

"How much did that guy make…………"

The fact about Ha Si-heon's entry point and investment size was already public knowledge. With Genesis's current stock price at $390.40, A simple calculation showed……………

“Oh・・・・・・ 569.41?"

Someone exclaimed in a hoarse voice. That was the result of calculating Ha Si-heon's return on investment. <569.41%.> That was Ha Si-heon's rate of return. Applying it to his initial capital…………… <$179,399,480>

An associate rubbed his eyes looking at the screen.

"Is this even a real number?"

It doesn't make sense logically, but Genesis's insane rush was an event beyond normal reasoning.

He turned off the reality switch in his mind and read the numbers one by one.

One, ten, hundred, thousand……. Million, ten million…….

“Gasp! $179 million?"

It was an unbelievable figure. But counting again, it was correct. Ha Si-heon’s investment had ballooned to……………

A staggering $179,399,480.

That’s approximately 243 billion won in Korean currency.

“Crazy……."

It's a figure that's hard to grasp even if you see it. But Ha Si-heon made that unbelievable amount of money in just one month.

"Is this even possible?"

***

January 9, 2014.

Genesis's stock price started at $71 and soared sharply like a comet, peaking at $398. It showed a slight decline afterward, but after catching its breath, it continued to rise, ending the trading day at $390.31.

That was an increase of 449.86%. Achieved in just one day. It was an unprecedented event that would be remembered in the history of biopharmaceuticals.

Wall Street was wrapped in astonishment and thrill. And the next day. The eyes of investors worldwide were focused on Genesis.

Three possible scenarios were unfolding: Either continue the frenzied rush. Desperately maintain its current value. Or a sharp drop due to a mass withdrawal by cooled-down investors.

-Let’s go today too!!!

-It’s already breached the ceiling, how much higher can it go

-Escape is in order of intelligence lol

-Already jumped 20% more off-market, that’s nonsense

-Let’s just defend, please

Amid divided opinions, the market bell rang. And Genesis's stock price…………… Once again traced an upward trajectory. Although it wasn't as steep as the day before, it zigzagged steadily upwards, breaking through even the $497 mark at one point. This was the result of various factors acting together, especially the intense interest from the media.

The barrage of coverage overnight had ignited investors' psychology.

<Forbes, "The Surprising Identity of Genesis’s Major Shareholder">

In the midst of this, the identity of Genesis's major shareholder was revealed.

He was a prominent bio-investor who had previously made it to Forbes's billionaire list. He was considered a masterstroke in the field, holding over 30% of Genesis's shares.

This news enchanted more people with the potential of Genesis. Meanwhile, interest in NASH also intensified.

<Global Times, "NASH, The Hidden Disease. Could Outpace HCV and Viral Hepatitis as a Pandemic">

NASH was a relatively unknown disease until diagnostic criteria were established around 1980. Also, it is often hard to detect due to virtually no initial symptoms.

This means that many asymptomatic patients exist. As awareness of the disease spreads, these latent asymptomatic patients could be diagnosed en masse, potentially leading to an explosion in patient numbers. Considering a prevalence rate of 12% among middle-aged adults, this could cause chaos comparable to an epidemic. Such observations further solidified Genesis’s unique position.

Well, Genesis is the only one that has a treatment for this epidemic. But, Above all, the most decisive factor in the stock price increase was the investment report by Merrill Lynch.

<BAML, "Estimated annual sales of over $40 billion if OCA is commercialized successfully; target stock price $872">

Just a week ago, the target price was $81, and it was adjusted upward by 1,094%! This was an anomaly even by Wall Street standards.

Therefore, Genesis investors were in a dilemma. Those aiming for short-term profits were about to take their profits around this time, but a prestigious Wall Street investment bank had predicted more than double the rise.

—Any stock experts around?

—Really hitting $872?

— Is this a hold?

As demand surged, so did supply. Soon, paid investment sites were flooded with experts' forecasts and advice.

Opinions among experts were divided.

<NASH progresses slowly, and there is a high possibility that patients will not actively seek treatment. The market size prediction is overly optimistic…………>

Some advised to sell immediately,

<OCA's current stock price reflects expectations for its efficacy in treating liver fibrosis. However, since the data has not yet been released, a stock price adjustment is inevitable depending on the results……>

Others said to wait and see,

<Genesis is already pursuing collaboration with overseas partners in China, Japan, etc. If successful, it could preempt a vast market comprising 10% of the global population…………>

And some urged to buy more. There are only three paths in investing: Buy, sell, or wait, But with arguments justifying every choice rampant, It became even harder to decide.

—The market has gone mad……………

— It's the stage of crowd psychology, so prediction is utterly impossible.

There was no shortage of cynical reactions that analysis itself was now meaningless. However, The employees at Goldman did not agree with that opinion because they knew one person who had anticipated all this.

The person who had seen through all these trends from the beginning. It was Ha Si-heon.

***

"How high do you think it will go?"

"When are you getting out?"

"Did you see the report from Alpha Seeker today?"

As evening came, a huge crowd surged into the M&A department. It seemed they had more than one or two questions.

Just as I was about to pick one question to answer.

"Hey hey hey hey!"

There was someone in front of me, blocking my way.

Like setting up a fence, this foolish guy had his arms wide open in front of me. He's my fifth largest investor, Faber.

"Don't tell them! They're not even investors!"

Faber is, so to speak, a paid member of my fund. Since he's paying, he wouldn't like it if I provided information to outsiders for free.

"What does it matter? We're all shareholders here anyway…………"

"It's not like you go bankrupt just by telling them, right?"

As someone retorted, veins bulged on Faber's forehead.

"If you're so curious, pay up and join! What makes you so bold to pick up others' picks for free!"

"You dropped it first. Don't you know it's not a crime to pick up money dropped on the street?"

Faber's face contorted with contempt. With the way he treated everyone around like thieves, I sighed deeply inside.

This guy wants to monopolize the information all by himself. If this were Pangyo, he’d be content just grabbing the prime spots for himself. In other words, his way of thinking is closer to that of an ordinary person.

‘His mindset is too narrow.’

With that kind of mentality, he won't last long in this field. Have I ever said it? The scale of opportunism between Wall Street folks and ordinary people is different. It means their capacity for greed is different. Faber’s anger soon turned towards me.

"You too! Do you answer straightforwardly when asked!"

"I had no intention of sharing the information."

"Stop joking! You were about to say something!"

"I was about to. ‘Just listening to stocks and investing is extremely dangerous. Make your own decisions.'"

Disappointed by my answer, people slowly started to leave.

I turned my gaze towards Faber. "So, what brings you here?"

"Ah, well……………."

Faber scratched the back of his head with an awkward expression. His previous assertiveness had vanished.

"Did you see the text I sent?"

"No, I haven't seen it yet. I haven't had the chance."

When I opened the message, Faber’s request was clear.

"It's a redemption request."

"Haha, I didn’t want to get too greedy and end up in trouble. As you know, it’s quite unstable."

"Understood. I’ll settle it based on the time of the request."

"That’s at 2:15 PM, right, based on that time?"

It turns out this was why he came in person. Faber even pulled up the stock chart for confirmation.

At 2:15 PM, the stock price was $496.89. Now it’s down about $30 to $467.02.

At first glance, it seems like a loss for me. I’d have to settle about $30 more per share. But, well, I've decided not to sweat this small amount.

"The return is calculated at 756.71%, totaling $471,693. After deducting half as management fees, it's $235,846."

I take half of the earnings in fees. That’s more than enough to cover any difference.

"Isn’t 50% a bit too expensive, though…………….."

As we talked about the fee, a bitter expression crossed Faber’s face.

However, I firmly responded, "If it weren’t for me, you wouldn’t have invested $55,000 in the first place. Even if you had, you would have cut your losses long ago."

"That’s true but…….”

It must sting. But a deal is a deal.

"As I mentioned, the actual payment date is March 1st."

This clause also works in my favor. From today until March 1st, I can freely utilize the $471,000 with no owner. And I get to keep all the profits made from that money.

"Fine……. Got it."

As the grumbling Faber left, the associates who had been circling around came closer again. I could see anticipation and curiosity in their eyes.

"Now that the nuisance is gone, can’t you share just a little?"

"How high do you think it will go?"

"Is the $872 that Merrill Lynch mentioned possible?"

Should I really tell them?

Prev | TOC I Next