Chapter 99: Chapter 099: Private Equity Account
After fluctuating between 47,070 and 47,090 for about ten minutes, the resistance at 47,090 became increasingly heavy. Eventually, there were hardly any trades executed at 47,090, and the range shifted to 47,070 to 47,080.
Moreover, the moving averages formed a death cross.
At this point, Chen Wei realized that copper prices were likely to decline.
He placed a hundred short positions at 47,080. After entering the market, he didn't immediately place exit orders at 47,070; instead, he waited for a moment.
As expected, copper prices began to fall.
They dropped below the 60-minute moving average, reaching 47,040.
However, Chen Wei noticed signs of an upward trend in the MACD indicator.
Additionally, at the 47,040 level, the downward momentum noticeably slowed.
It seemed like the decline had stalled.
Without hesitation, Chen Wei exited at 47,040, earning twenty thousand yuan.
After exiting, within less than a minute, copper prices rebounded to 47,080.
Chen Wei didn't rush to enter the market. After observing for a while and seeing that 47,080 remained a resistance level, he placed sell orders at that price.
Entering at 47,080 and exiting at 47,070, he made three or four trades back and forth, narrowing the range to 47,060 to 47,070. He made several more trades, dropping the range by another price level.
Throughout the morning, copper prices changed their range every ten minutes or so, and Chen Wei was thrilled with his trading.
Near the end of the morning session, copper prices finally made a slight upward movement. Chen Wei didn't enter the market again.
In the morning alone, he earned over two hundred and ten thousand points.
After trading copper for over a week, Chen Wei had become familiar with its price movements.
The volume of the main contract was sufficient, and trading was relatively active. The volatility wasn't as intense as that of major stocks in the US market; it was quite stable.
Of course, this was mainly because copper hadn't experienced any significant news over the past week.
This stable range-bound trend was very suitable for Chen Wei's intraday trading strategy.
However, Chen Wei also realized that trading a hundred contracts was almost his limit. If he traded more contracts, the trading volume wouldn't support it.
In other words, earning two hundred thousand yuan in the morning was about the maximum. To earn more, he would need significant news or a major trend.
Currently, earning two hundred thousand yuan in half a day was already excellent. It could amount to three to four million yuan in a month.
However, once the capital increased, this approach wouldn't work anymore, and he would have to trade other types of assets.
Chen Wei now recognized a drawback: the trading software he was using couldn't handle multiple accounts simultaneously.
Unlike the Sterling software for US stocks, which could open numerous trading windows simultaneously, allowing theoretically unlimited stock trading, this futures software could only operate one type of asset at a time.
This limitation was significant, especially for Chen Wei's range trading strategy. He needed to constantly operate, placing orders and exiting positions. Consequently, he couldn't trade other assets simultaneously.
After the morning session ended, Chen Wei went downstairs to grab something to eat. Upon returning, he continued contemplating this issue.
For now, it didn't have a significant impact on him since he only traded copper.
But in the future, it wouldn't suffice.
He had to think of a solution; otherwise, it would seriously restrict his trading limits in the future.
Chen Wei thought of the private equity funds in China.
Suddenly, everything became clear!
Multiple accounts, multiple traders!
He could open several accounts and then recruit traders to trade on his behalf!
His role would be to monitor the market and give trading instructions!
However, there was one problem: if he opened too many accounts, it would easily raise suspicions of irregular trading!
After pondering, Chen Wei called Du Shan.
Du Shan was having a meal, but when she saw Chen Wei's call, she quickly answered.
Last week, Chen Wei had truly surprised her!
With over a million yuan in capital, conducting dozens of transactions every day! Making seventy to eighty thousand or even over a hundred thousand yuan in a day, not to mention the transaction fees, which amounted to thousands of yuan per day!
As a salesperson, Du Shan earned commissions from transaction fees. Their commission rates were tiered, but roughly speaking, she could earn one to two thousand yuan per day from Chen Wei alone!
If Chen Wei continued like this, she could earn thirty to forty thousand yuan in commissions per month!
Previously, Du Shan's monthly income was only a few thousand yuan. Now, with Chen Wei alone, she had multiplied her earnings several times!
In Du Shan's eyes, Chen Wei was already her financial god.
Several times, Du Shan wanted to invite Chen Wei out to express her gratitude properly, but she was afraid of being too abrupt, so she held back.
Now, seeing Chen Wei's call, Du Shan didn't dare to delay.
"Hello, Chen Ge, what's up?"
In her softest voice, Du Shan asked.
"Du Shan, I want to ask, can you split accounts there? I mean, can one account be split into several, allowing multiple people to trade simultaneously?"
After some thought, Chen Wei asked.
"Are you talking about sub-account trading? Yes, it's possible, Chen Ge. Nowadays, many private equity funds use this method. However, only corporate accounts can establish sub-account trading; personal accounts cannot. If you want to set up sub-accounts, you need to register a company first and then open an account in the name of the company."
Excitedly, Du Shan replied.
This was the rhythm of setting up a private equity fund!
If she could attract a private equity client, she would be set for life!
"Ah, I see! Are there any other requirements for these corporate accounts?"
Chen Wei pondered briefly and asked again.
"The corporate account doesn't have many restrictions; any company can open one. However, if you, Chen Ge, plan to venture into private equity in the future, I suggest applying for an investment operation license from the relevant department when establishing the company. This will save you a lot of trouble later on. Additionally, if you want to establish a private equity fund, you must set up a fund company. As for the specific regulatory requirements, Chen Ge, you can look them up yourself. I remember it requires a registered capital of around five hundred million yuan."
Du Shan provided Chen Wei with all the information she knew truthfully.
After hearing this, Chen Wei had a rough idea in mind. He thanked Du Shan and said, "Alright, I got it. Thank you. When you're free someday, I'll treat you to a meal. I still have many questions to ask you."
"Chen Ge, you're too polite. If there's anything you need in the future, feel free to call me."
Du Shan replied promptly.
After hanging up the phone, Chen Wei thought for a moment and then searched for some relevant information online.
It was too early to establish a private equity fund now, with a registered capital of five hundred million yuan, which he didn't even have a fraction of.
So, he could only start by registering and establishing an investment company, and then apply to the relevant department for an investment operation license.
As for this investment operation license, he would have to find Yue Jiawen.
Because Yue Jiawen worked in the securities regulatory authority.
However, Yue Jiawen was in the Lingnan Securities Regulatory Authority, and Chen Wei wasn't sure if he could help in Yunzhou.
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