Making “Nasdaq whale”, SoftBank was blown $ 17 billion in market capitalization after only 3 sessions

After stocks on the US stock market were sold off at the end of last week, shares of SoftBank Group have continuously plunged, showing concerns about the impact of the technology industry on the corporation.

Closing today (9/9), SoftBank shares fell 7.1% and a total decrease of 14% since the beginning of the week until now.

According to a SoftBank statement, the group has bought billions of dollars worth of technology shares like Amazon ($ 1.04 billion), Netflix ($ 189 million), Adobe ($ 248 million) and Alphabet ( 475 million USD). However, over the weekend, a series of newspapers reported that the actual number is much larger because Softbank bought billions of dollars in options contracts to buy these shares.

Despite a sharp decline today, Softbank shares have risen more than 20% since the end of last year. According to the Financial Times, SoftBank is still making about $ 4 billion in profit from the use of derivative contracts. In the past the corporation has made a big profit by implementing a similar strategy on the shares of chipmaker Nvidia.

However, SoftBank’s ownership of so many US technology shares has raised new concerns about the valuation of the corporation in the context of economies around the world being badly damaged by Covid-19. The speculation fever with huge amount of bets on the bullish scenario on the options market and on bankrupt companies officially collapsed in early September, causing trillions of capitalization to be blown. fly.

“When there is a technology bubble, Masayoshi Son will always act,” said Amir Anvarzadeh, a strategist at consulting firm Asymmetric Advisors.

SoftBank shares plunged in March as investors were concerned about massive debt levels and losing investments in private companies like WeWork. At that time, founder Masayoshi Son announced plans to sell off his assets to earn about $ 41 billion. SoftBank recently surpassed that target after selling stakes in T-Mobile (USA) and SoftBank (Japan) as well as raising cash through stakes in Alibaba.

Some of the money raised from this campaign has been used to buy listed shares.