SoftBank Has Closed Most Of Its “Nasdaq Whale” Positions

Following our Thursday report identifying SoftBank as the primary – but not only – catalyst behind the bizarre moves in high beta tech names and the broader market over the past several weeks (confirmed later by the FT and WSJ), an odyssey which we summarized in Connecting The Dots: How SoftBank Made Billions Using The Biggest “Gamma Squeeze” In History with subsequent reports that SoftBank, or the “Nasdaq whale” as some now call it was sitting on “unbooked” profits of about $4 billion, the market was quick to punish SoftBank (9984.JT) which dropped on Friday then tumbled another 7% on Monday despite what the company has been proud to frequently remind its investors was the second biggest buyback authorization after Apple.

There were two reasons cited for the drop: the first was the realization that “SoftBank’s behaviour as a company increasingly resembled that of a hedge fund, populated with former investment bankers with a massive appetite for risk.” This realization was assisted by our weekend report which revealed the main players behind the Softbank trade, which was the brainchild of Abu Dhabi-based Akshay Naheta, a former Deutsche Bank prop trader who now heads SoftBank’s new asset management team which invests in public equities, including all those tech companies that have soared in August on the massive gamma melt-up facilitated by concurrent call buying as described previously.

The second reason cited by the FT for today’s tumble is that “retail investors, which make up 30 per cent of SoftBank’s shareholder registry, reacted particularly negatively to the company’s latest shift in investment strategy.”

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I made my name because my hubs is a Locomotive Engineer on the Railroad for over 45  years now.  It’s funny how it fits right into the TRUMP TRAIN.  I am one of God’s many Children trying my best daily to live by God’s Word.  I have many hobbies on the computer and off the computer.  God Bless!

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