Chapter 215 - Chapter 215: Stock Price Index
Steve was checking the stock price index.
KAPIC, the Cascade Kingdom Stock Price Index, is an index calculated based on major listed stocks.
Steve disliked the stock price index. The reason was that his own holdings could be sold in correlation with the stock price index.
The Cascade Kingdom Stock Price Index also has futures, just like the Nikkei Average. And because of that, speculators who engage in arbitrage or so-called "saya-tori" strategies have appeared.
This targets the difference between the stock price index and the stock tickers used to calculate it. For example, suppose there are two tickers, A and B, and a stock price index calculated from them. If A is 10 and B is 10, the index is 20. However, suppose there is a futures contract for this index, and it is 30. In this case, if one buys A and B and sells the futures, a profit difference of 10 is generated. Whether the number behind the digits is dollars or yen depends on the index.
In current Japan and America, computers are advanced, and speculators target slight deviations within a very short time, so it is rare for that deviation to become large, but sometimes investors engaged in arbitrage stop their trading due to terrorism or disasters. Then, the deviation between the actual stocks and the index futures can become large.
That is the situation, and even here in the Cascade Kingdom, the tickers included in the stock price index were affected by this. Incidentally, computers are also being developed, and currently, orders are being executed at speeds far faster than humans can manage.
This is the cause of stocks being sold in correlation with the index.
Furthermore, laws have been enacted making insider trading illegal in stock transactions, but regarding index futures, there are no regulations on insider trading.
"Archibalt Steel's financial results might trigger a market-wide decline."
He muttered with a sigh.
Archibalt Steel, which announced its financial results the previous day, was selling from the opening bell, falling short of market expectations.
If iron is not profitable, the performance of companies using it might also be poor. One might expect commentary explaining that they are selling based on such logic, but in reality, futures were being sold, and arbitrage speculators targeting that spread had entered sell orders into the index constituent stocks.
And then, the fall of holdings in tandem.
If Steve were to mention the name, the bought ticker would rise immediately, but that is an act that distorts the market, so he tries to avoid it as much as possible. Regarding long-term investment, he holds them through an asset management company, taking care to prevent the appearance of "lamps" (puppet stocks).
"I wonder if I should buy more, expecting a rebound buy based on a revision of performance."
Muttering that, he entered the number of shares to buy more on the app's order screen.
The UI, user interface, in this area is quite close to his previous life. In the end, what humans seek remains the same even if the world changes.
At the same time, Aurora was obtaining information regarding Archibalt Steel.
"Hee, the pipes ordered by Archibalt Steel from our transportation company have a delivery destination of the Big Bear Empire, with the address disguised as a private warehouse but actually a military facility. Furthermore, mechanical parts such as bearings are being sent to the same address at the same time. Also, the export destination of the cannon blueprints by Dr. Ricardo Bell, a private researcher, has the Big Bear Empire listed as a candidate. What can be derived from that is the manufacturing of a giant cannon. The problem is, how much did Archibalt Steel grasp of this..."
The report stated that the sales department of Archibalt Steel was moving to assist in procuring parts such as bearings. However, it also stated that they could not identify who the top person issuing those orders was.
"Waiting for additional investigation. But, perhaps this could become information that can be used incredibly effectively."
Aurora was thinking about how to handle the report to achieve the maximum benefit for herself.
And she had a premonition that it could be used to solve the problem she was currently worrying about.