In the past 10 days, HSBC shares have put on a 25 per cent rebound. Very attractive indeed. In case you are amazed or even tempted to join the cause, read this.
Scene one: On March 10, a tai-tai called up her private banker, saying she would like to buy several million US dollars worth of HSBC April put options at HK$25 each.
In layman's terms, she was offering to sell the share at HK$25 in early April. In short, she expects the stock to go below HK$25 after the bank has completed its rights issue. Mind you, HSBC had just traded down to the 10-year record low of HK$33 a day before, scaring the devil out of many.
Rich people make all sorts of interesting bets. Private bankers are no stranger to these. But the size the woman offered did raise eyebrows. And she's not alone. Many more tai-tai came up with offers along the same line that day with various bankers.
'It's just phenomenal, and they are no ordinary tai-tai,' said one of the private bankers involved.
Scene two: Some HSBC-holding 'high-net-worth individuals' - a jargon used by bankers to describe those with tens of million dollars - received calls with opposite messages from investment banks. The banks were offering to write HSBC put options at HK$55 each.