Golden Spoon Investment Portfolio - Chapter 236

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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The Blue House and the ruling party have no choice in the matter.

Choi Ho-geun knocked before entering, and upon seeing Seok-won seated at his desk, he bowed respectfully.

“Chairman. I came as soon as you called for me.”

Seok-won covered the approval documents he’d been reviewing and gestured toward the sofa in front with his chin.

“Have a seat there.”
“Yes, sir.”

Choi Ho-geun carefully settled onto the sofa to the right.
Seok-won then rose from his desk, walked around it, and took the seat of honor in the center, crossing one leg casually as he regarded Choi Ho-geun.
Crossing one leg lightly over the other, she asked while looking at Director Choi Ho-geun.

“You must find it unfamiliar and awkward after changing companies, but is everyone doing well?”

Manager Choi Ho-geun then cracked a joke with a smile on his face.

“Only the company changed, but the work I do is the same, so I’m adapting without much difficulty. And since they even gave me a raise, I have to make do with any inconveniences that come up.”

Relying on that alone, they had followed him to a company far smaller than their original Daehung Securities, so providing such benefits was entirely justified.
He followed me to a much smaller company than Daehung Securities, where I originally worked, based solely on that one thing, so I could certainly afford to give him that level of benefit.

“Yes, understood.”
Yes, I understand.

While he didn’t openly distance himself, there were those in the Capital Operations Division who viewed him unfavorably as an outsider, so his approach was prudent in many respects.
While he didn’t openly distance himself, there were those who viewed him unfavorably as an outsider who had rolled in from the streets, so maintaining some restraint was a wise course of action in many ways.

“Well, we’ve rested enough, so shouldn’t we start getting to work now?”

Manager Choi Ho-geun’s eyes lit up as he leaned forward eagerly in his seat.

“I was already feeling restless and itchy to move around.”

Seok-won smiled slightly at the corner of his mouth as he spoke, responding to the attitude of leaving everything to him.

“You’ve already opened a trading account at Daehung Securities, haven’t you?”
“Of course.”
“Tomorrow, 55 billion won will be deposited into the account. I want you to use 50 billion of that to purchase shares in Korean Mobile Telecommunications, A-One, and Jeong-mi Electronics over the course of a week, splitting the purchases.”

Choi Ho-geun furrowed his brow slightly and spoke with caution.

“The recent surge in information technology stocks has certainly brought significant attention to Korean Mobile Telecommunications as the leading stock, along with the companies you mentioned. However, given this attention, stock prices have already risen considerably. Do you believe there’s still room for further appreciation?”
“You think we’re at the peak right now?”
“The enthusiasm hasn’t cooled yet, so prices could continue climbing. However, I believe the upside potential is limited. Given how much they’ve already risen, the downside risk is substantial.”

Seok-won leaned back against the sofa, his expression relaxed as he listened intently to Choi Ho-geun’s concerns.

“I agree that information technology stocks are in a state of short-term overheating. But I don’t believe we’re at the peak.”
“Then you believe prices will continue rising from here?”

Seok-won nodded as he observed Choi Ho-geun’s continued skepticism.

“Yes.”

He then interlaced his fingers and rested his hands on his knees.

“Did you see the article in this morning’s newspaper about Saechang Communications beginning trial service for CDMA mobile phones?”
“Yes.”
“If you look at the business section articles from the past month, you’ll notice that CDMA and new telecommunications operator selection appear in the news every single day without fail.”
“Well, that’s because it’s the hottest issue right now, isn’t it?”
“Exactly.”

Seok-won straightened his posture, a deep smile playing at the corners of his mouth.

“There’s a saying that the stock market feeds on dreams and hope. When articles like these continue to dominate the newspapers and paint a rosy future, stock prices have no choice but to rise.”

Yet Choi Ho-geun maintained his skeptical demeanor.

“That’s true, but haven’t information technology stocks continued their upward trend even during market downturns by exhausting all these positive catalysts? While the uptrend hasn’t broken, the momentum has clearly diminished. Looking at how stagnant prices have become, we’re nearly at the end of this cycle.”
“My assessment is different. Yes, there’s hesitation, but I believe there’s still one final surge left.”

Choi Ho-geun tilted his head in confusion, unable to comprehend Seok-won’s inexplicable confidence.

“May I ask what that might be?”

Seok-won then spoke matter-of-factly.

“It’s about expanding the foreign investment stock limit.”
“…!”

Choi Ho-geun’s eyes widened in surprise at this unexpected revelation.
He leaned forward urgently and asked.

“Are you saying the foreign investment limit will increase?”
“Yes. As we’ve already experienced, if the equity ratio currently capped at 15% expands further, foreign capital will flow in proportionally to that increase and drive up the stock market.”

Seok-won’s eyes gleamed with mischievous amusement as he watched Choi Ho-geun still struggling to process his shock.

“Where do you think the fresh capital will flow first?”

Only then did Choi Ho-geun understand why stock prices would rise further, and he let out a low murmur.

“Hmm. Of course, the money will naturally flow into the hottest information technology stocks.”
“They’ve already far exceeded their fair value, but from that point on, a liquidity rally will unfold where the inflowing capital drives up the stock price.”

Having experienced firsthand what happens when foreign investment capital floods in, Choi Ho-geun didn’t resist further and immediately agreed.
Rather, thinking of the stock market—which had been in general decline since last year except for information technology stocks—burning hot once again, his heart raced with anticipation.
Then, struck by a sudden thought, Choi Ho-geun asked cautiously.

“But I haven’t heard any news or rumors about expanding the foreign investment stock limit. How do you know about this?”
“Because the Blue House and the ruling party have no choice but to do it.”
“I beg your pardon?”

Choi Ho-geun’s expression grew even more puzzled.

“What happens in April?”
“In April….”

Choi Ho-geun tilted his head in thought for a moment, then suddenly looked up and answered.

“Are you referring to the 15th general election?”
“Exactly. For President Kim Sung-gyu to smoothly lead out his remaining term, the ruling party must win this general election and secure more than half the seats in the National Assembly by any means necessary. But you already know the situation isn’t particularly favorable.”

Choi Ho-geun nodded slightly, his expression turning bitter.

“Successive major accidents and the slush fund scandals involving two former presidents have combined to sour public opinion.”
“And with the stock market performing poorly on top of that, the approval ratings are bound to plummet further.”

As Choi Ho-geun listened, he suddenly grasped something and let out an exclamation of realization.

“You’re saying the government will increase foreign investment limits to prop up the stock market ahead of the general election!”
“Exactly right. Since they’ve already profited from this method once, they’ll want to use it again.”

Though the explanation seemed plausible and reasonable, Choi Ho-geun’s expression remained unsettled.

‘It’s true that the Blue House and the ruling party need to boost the stock market to raise approval ratings, but that doesn’t necessarily mean expanding foreign investment limits.’

After all, there were other stock market stimulus measures available—tax cuts, expanded institutional investor stock purchases, and more.
Yet to specifically pinpoint the expansion of foreign stock investment limits struck me as odd.
Still, seeing such confident conviction in betting a full 50 billion won—no small sum—I was certain there was something else he hadn’t revealed to me.

‘Given that the chairman is a third-generation chaebol heir, it wouldn’t be unusual for him to have channels feeding such information to the ruling party or the Blue House.’

Having constructed a narrative that satisfied his own reasoning, Choi Ho-geun’s mind immediately turned to how best to capitalize on this.

“To avoid accusations of election-timed policy, the government announcement should come soon.”
“Exactly why I told you to complete the staged purchases within a week.”

Choi Ho-geun nodded and asked.

“Then how much should we purchase for each stock?”

Seok-won, who had already considered this, answered immediately.

“Put 1 billion won into Korean Mobile Telecommunications, and split the remainder between two other stocks.”

Choi Ho-geun’s expression grew puzzled, having naturally assumed we would purchase the most of Korean Mobile Telecommunications, the leading telecom stock.

“You’re saying we should buy more of A-One and Jeong-mi Electronics instead of Korean Mobile Telecommunications?”
“Korean Mobile Telecommunications has already risen as much as it can, with limited upside potential, whereas the other two stocks will see far greater gains. Isn’t it obvious we should buy more of those?”
“Ah… now that you mention it, that makes sense.”

Choi Ho-geun belatedly reproached himself for failing to see that far ahead.
Compared to Seok-won’s expansive vision, I was still fumbling about in a narrow corridor.
Then Seok-won lowered his voice slightly and spoke quietly.

“Even if foreign capital flows in and liquidity drives the market, stock prices won’t continue rising endlessly.”

Since every beginning must have an end, Choi Ho-geun asked with a grave expression.

“Then when do you think stock prices will turn downward?”
“The selection of new telecommunications operators in June will be the inflection point.”
“So you’re saying we should follow the market adage—buy on rumor, sell on news.”

Following the privatization of Korean Mobile Telecommunications, the government, having launched Sae Chang Telecom as a private operator, decided to further open the mobile communications market to strengthen competitiveness.
As part of this initiative, the government proceeded with the selection of new telecommunications operators, designating three Personal Communications Services (PCS) operators and selecting operators in seven fields including Trunked Radio System (TRS), circuit leasing, and wireless data communications.
Since this was a business involving enormous profits—essentially granting monopoly rights—competition among corporations was fierce, which explained why information and communications stocks were rising alone while the market remained sluggish.

“Stock prices rose on expectations, and once the fuel that fed the fire disappears, nothing but decline awaits, doesn’t it?”
“Most stocks that surged in the domestic market have ended that way, so this time should be no exception.”

Choi Ho-geun smiled bitterly.

“By then, foreign capital flowing in from expanded stock investment limits will be reaching its peak. It would be wise to liquidate our positions before that happens.”
“If two adverse factors converge simultaneously, the market we’ve worked so hard to lift could plunge back into stagnation.”

Choi Ho-geun’s expression hardened slightly.

“Until the general election, government stimulus will keep the market looking bright, but once that effect wears off, there’s a high probability it will turn bearish. Keep that in mind when managing investment funds.”
“I’ll remember that.”

Choi Ho-geun, having committed Seok-won’s instructions to memory, continued with his next question.

“Then what should we do with the remaining 5 billion won?”
“Have you and your team members trade independently and generate profits on your own.”
“Understood.”

Since Investment Team 4 possessed considerable skill, I had no reservations about entrusting them with this responsibility.
For some time afterward, Seok-won engaged in an in-depth discussion with Choi Ho-geun about how to proceed with the investments.

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This chapter was translated by Lunox Novels. To support us and help keep this series going, visit our website: LunoxScans.com
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