Chapter 290: The Unknown Scheme

"A vulnerability?"
"That's right, it's a quantitative trading system."
A quantitative trading system, simply put, is an automated trading program.
"Automation" sounds trendy, but its history dates back to the 1970s.
Since then, it has continuously evolved, later deeply integrating with artificial intelligence (AI) technology, which swept through the world of Go and permeated all walks of life, giving rise to so-called "algorithmic trading."
Which reputable financial company doesn't have several quantitative trading systems?
These systems automatically execute massive amounts of trading orders, measured in milliseconds.
"The problem lies in this 'automatic' aspect.
These systems execute commands according to pre-written programs. When an extreme situation occurs that even the developers couldn't foresee, the system doesn't consider the potential tsunami it might trigger; it only executes the most basic instruction:
Close all positions immediately, survival is paramount!"
"The extreme situation you're talking about… could it be…?"
"Exactly! Like some crazy lunatic with hundreds of billions of euros, betting everything on the collapse of Britain!"
Yes, who could have imagined that?
What normal person, when writing code, would include a scenario like "a reckless, extravagant madman using hundreds of billions to crash the market"?
"So, after detecting the massive sell orders that suddenly flooded in, enough to crush the market, the system automatically triggered the liquidation procedure.
According to our investigation, several financial companies tried to manually shut down the system immediately, but… it was too late."
The catastrophic scene instantly flashed through Bell's mind.
One trading system initiated forced liquidation, like the first domino to fall.
Then came the second, the third…
This wave of panic spread exponentially, sweeping across the entire London financial world!
When everyone saw the financial giants frantically selling, an apocalyptic fear gripped everyone's hearts.
Retail investors sold, institutions sold, and even quantitative trading systems that hadn't experienced systemic errors joined the sell-off based on market trends.
Everyone, human and machine alike, was caught in an irrational stampede, scrambling to dump all their positions.
Ultimately, the entire market transformed into a hellish scene of stampedes, fleeing, and wailing!
"It's often said that financial crises stem from the most insignificant oversights. This is absolutely true."
Throughout financial history, the reasons for the collapse of those colossal giants are often laughably absurd.
For example, a trader might accidentally add an extra zero to the purchase amount, leading to the company's bankruptcy.
Or an accountant might make a mistake with a decimal point in their tax return, resulting in penalties that force the company to close down.
This time, however, it's an epic financial catastrophe triggered by an over-reliance on quantitative trading and AI technology.
Bell sighed.
"What's the overall loss situation?"
"Large financial companies like ours, with our good connections, reacted quickly enough to capitalize on the chaos and made a few hasty trades, mitigating some of the losses, ultimately resulting in a small loss."
But those small and medium-sized financial companies, lagging behind in information and with limited scale, fared even worse.
They died without ever knowing what had happened, swept away by the raging storm, and ultimately… almost all of them were smashed to pieces, leaving no trace.”
Companies heavily reliant on quantitative trading, in particular, became the biggest casualties of this disaster.
“As for the UK itself… the impact was devastating.
No one can predict the future.
Because of this event, the EU, which had been trying to delay Brexit, suddenly made a complete 180-degree turn and became unusually proactive.”
“Afraid that the British economic crisis would spread to them, so they wanted to cut ties prematurely?”
“It seems that’s the intention.”
Great Britain is now completely crippled.
They are a country heavily reliant on imports, and every fluctuation in their exchange rate affects countless people.
Thinking of this, Bell's curiosity was ignited.
"But I still don't understand why Fang Huan specifically targeted Britain? Why not other countries?"
Since Fang Huan knew about this vulnerability in the quantitative analysis system, attacking any other developed economy would theoretically have been effective.
"Perhaps, there were political considerations involved. At the time, Britain was on the verge of a 'hard Brexit,' and people were filled with anxiety.
Moreover, as we just mentioned, this move indirectly gave Theresa May a way out, a favor, and could indirectly reduce the possibility of future retaliation.
Most importantly, this operation was spearheaded by Fang Huan, with global financial giants joining in."
"The law doesn't punish everyone; even if Britain wanted to investigate, who could they really do anything to?"
"No, that's not right." Bell shook his head. "Even so, I still feel...something's not right."
Why Britain of all people?
He firmly believed that there was a deeper, unknown conspiracy hidden behind this!
***
Before the last sum of money successfully flowed back into the account, everyone in Fanghuan Investment's top-tier trading department slumped in their chairs, as if all their energy had been drained.
But when they saw the breathtakingly long number on the screen, everyone's mouths gaped open in an "O" shape, as if an egg could fit inside.
Five hundred billion!
Even Su Hao himself felt a sense of unreality looking at that number.
"In my entire life... I've actually been able to personally trade this level of funds."
A trader murmured to himself, his voice trembling.
"Honestly, Chairman Su. Seeing how Britain was collapsing, I was genuinely worried we wouldn't get our money back."
Short selling requires your opponent to survive.
If your opponent is killed or bankrupt, then no matter how well you executed your short position, you won't be able to cash in your profits.
This time, they weren't betting tens or hundreds of billions, but a staggering gamble on the scale of hundreds of billions!
If the British Empire were to collapse completely, all their invested capital would be lost.
But fortunately, the British Empire had a strong financial foundation and managed to avoid being completely defeated.
That's precisely why they were able to work tirelessly through the night, managing to recover all the profits into their accounts without major incident.
Five hundred billion!
From shorting the Nikkei, to sweeping through France, and now stirring up trouble in Britain.
Although the decision was made by Su Hao, the ability to handle such a massive trading volume was entirely due to these brothers risking their lives, working day and night.
Su Hao felt it was time to give them a break and a good rest.
"Alright, next, we..."
"Chairman Su! Here's some information!"
Before Su Hao could finish speaking, a spirited Liang Haiyuan suddenly rushed over with a document in hand.
"...?"
"Chairman Su, I bet you'll find this useful! The UK's financial crisis has severely undervalued all companies.
I had the research department work overnight to screen and evaluate them, and they compiled a report. Let's see if there are any quality assets worth buying at rock-bottom prices!"
Looking at this automatically delivered "overtime guide," Su Hao blinked, momentarily speechless.