Have you heard of Archegos Capital Management? Part 2

morning-news

Gold  1711,77
(+0,27%)

EURUSD   1,1717
(-0,10%)

DJIA  32873,50
(-0,04%)

OIL.WTI  59,535
(+0,19%)

DAX   15037,50
(+0,01%)

In yesterday’s newsletter we stated that Bitcoin was the beneficiary of what happened to Archegos Capital Management’s hedge fund.


BTC

BTC

There has been a margin call of tens of billions of dollars in open positions in the fund. And we are talking about a fund run by a man previously convicted of insider trading. And this man was being lent tens of billions of dollars by the world’s leading investment banks. And not only did they lend, but their personal bank risk management departments didn’t actually do their direct job.
Looking at all this makes investors very sad. They immediately remember the events of 2000 (the dot-com crash) and 2008 (the mortgage crisis). Both of these events were accompanied by a huge amount of bank fraud and false accounting. Risk management departments slept through huge losses. And the regulators, who are supposed to look after the interests of investors, also slept through it all.
After every crisis like this, everyone beats their chests and says it won’t happen again. Laws will be changed, stricter reporting and auditing requirements will be imposed, etc. etc. However, in fact, we see that absolutely nothing changes.


And what are the big investors to do with all this?

It’s simple! Go out and buy bitcoin. Can its reporting be falsified? No, it can’t. Everyone can personally verify how many BTC are in the system and how many are in each particular wallet. Is it possible to increase Bitcoin issuance? No, you can’t, a strict algorithm shows exactly when the remaining 2.5 million BTCs will be created. Can Bitcoin be banned, confiscated, account frozen (conducting an investigation)? No you can’t. If an investor has a seed phrase, then only he owns BTC. And so on and so forth.
Every week and month, this reaches more and more traders, speculators, investors. And it is this that is the powerful fuel that drives up the price of the first cryptocurrency.

02.30 Australian retail sales for February
08.00 German retail sales for February
16.00 US ISM manufacturing index for March


Important Notes on This Publication:

The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.