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Chapter 233 - Chapter 233 - Reduce Holdings And Cash Out

A pier in southern Melbourne.

After three days of filming, 'Batman' finally concluded the film's first fight scene.

The plot begins with five consecutive murders in Gotham City. Some victims were shot, some had their necks broken, and some bore traces of animal bites.

Batman, following the clues, successfully rescued Vicky Vale, a female reporter from the Gotham Gazette, just as she was about to be murdered.

He then pursued the killer through the sewers to an abandoned pier on the city's outskirts.

The killer revealed his true identity: a massive, reptilian-like monster with sharp teeth and scales, resembling an alligator.

After a tough struggle, Batman finally subdued Killer Croc.

Meanwhile, a shaken Vicky Vale called the police, and Commissioner Gordon, who had also been closely investigating the recent murders, personally led a team to the pier.

Due to the police's arrival, Batman didn't have time to interrogate Killer Croc and was forced to retreat early.

This action sequence was followed by a dramatic scene, marking Commissioner Gordon and Batman's first formal encounter.

Night shoots, which recently began, run from 6 PM to 2 AM, still an eight-hour shift.

It's peak summer in the Southern Hemisphere, so daylight lasts a long time, but by the time pre-shoot preparations are complete, night has usually fallen.

It was already 1 AM. After the previous action scene, the setting didn't require much change.

The police were cleaning up the aftermath in the original location, and Commissioner Gordon, alerted, approached a nearby warehouse.

The set dressing for this scene had already been completed. Simon briefly communicated with the two actors, Adam Baldwin and Tommy Lee Jones, and filming officially began.

The clapperboard snapped, and all the actors, who had taken their positions, sprang into action.

Commissioner Gordon hesitantly walked to a streetlamp in front of the warehouse, while Batman crouched on the edge of the warehouse roof, most of his body shrouded by his cape.

The camera composition carried clear symbolism: Commissioner Gordon and Batman, one in light, one in darkness.

Feeling a slight sound above him, Commissioner Gordon looked up and finally saw the 'fugitive' he had also been pursuing for so long.

The two briefly faced off, then Gordon spoke first: "Alright, even though... but you did well".

Batman, however, showed no intention of small talk with Gordon. His tone was calm and cold as he said, "Have you found the connection?"

Gordon nodded, "Including Vicky Vale, three reporters have been attacked in the past week. Something is definitely happening in the city, and someone wants to cover it up".

Batman paused, not telling Gordon that he had actually discovered five related murders, and simply said, "I need an interrogation report on that crocodile".

"I don't cooperate with fugitives", Gordon blurted out. Noticing Batman's earlier hesitation, he asked, "Do you know something else?"

Batman returned the exact words: "I don't cooperate with the police".

Gordon frowned, "Then why do you think I'd give you the report?"

"Tomorrow night at midnight, here again".

Gordon shifted his feet, seemingly contemplating how to gain some leverage. After a brief moment of distraction, he looked up again, and the figure on the roof had vanished.

"Cut!"

Simon, behind the monitor, slightly raised his hand and called out, then began replaying the recent shot.

Adam Baldwin and Tommy Lee Jones quickly gathered around.

"The emotion is still a bit off", Simon explained to Tommy Lee Jones while personally pressing replay. "Tommy, this dialogue signifies that you two are unknowingly forming a subtle, underlying understanding, so the rhythm needs to be just right. Also, your little movement just now was a bit too deliberate; adjust it next time".

Simon needed a certain feeling, so he couldn't explain in too much detail how the two should act; they had to grasp and interpret it themselves.

After a brief discussion, the two actors prepared and began the second take.

When Bruce Wayne is in Batman mode, he essentially has a stoic demeanour, so the acting requirements for Adam Baldwin weren't too high, and Tommy Lee Jones was also a veteran actor of many years.

Therefore, after several takes, Simon achieved the satisfactory effect he needed.

At 2 AM, the crew wrapped up on time.

Simon went to bed around 3 AM and was already up, had breakfast, and was back in his hotel suite's study by 9 AM the next morning.

Jennifer's main job was to maintain contact with the two companies in North America and didn't need to stay up late with Simon on set.

When Simon entered the study, his female assistant had already prepared the documents he needed to review today.

"We have successfully established 5,000 long Nikkei 225 index futures contracts on the Osaka and Singapore commodity futures exchanges. The opening index was approximately 31,200 points, with an average margin of $25,300 per contract, totalling $126 million in margin paid. Dad believes that the company only needs to retain $50 million in reserve funds to sufficiently mitigate risk, so we can add another 1,000 contracts".

For the S&P 500 index futures back then, with 10x leverage, a single margin only required about $15,000.

The Nikkei 225 index futures still use 10x leverage. However, the contract multiplier for these index futures is 1,000 Japanese yen, which means the book value of each contract held by Westeros Company is 31.2 million Japanese yen.

In recent years, the Japanese yen has continuously appreciated against the US dollar, with a recent exchange rate of 123 to 1. 31.2 million Japanese yen converts to approximately $250,000, and a 10% margin ratio is $25,000.

Simon listened to Jennifer's introduction while flipping through the documents in his hand.

In the past two weeks, the growth rate of the Nikkei 225 index has clearly accelerated.

In December last year, when the Nikkei 225 index broke through 30,000 points, the monthly increase was only 623 points, but in the past two weeks, the Nikkei index has risen by a full 860 points, an increase of 2.7%.

It's unclear if this is due to people hearing the news and starting to follow suit.

Westeros Company currently has only $200 million in freely available funds, which just transferred from Daenerys Entertainment.

With the planned 5,000 contracts established, only $70 million in remaining funds are left.

Simon is not as clear about the Japanese stock market's trend over the next year as he was about the North American stock market in October of the year before last.

Therefore, he definitely cannot go all-in and needs to set aside funds to cover the risk of potential margin calls.

After a rough calculation, based on the current holding ratio, if the Nikkei 225 index can still reach the high of over 38,000 points in the original timeline, theoretically, after deducting the stock index futures trading tax and high capital gains tax in the Japanese market, Westeros Company's $200 million principal could roughly double by the end of the year, achieving a 100% net profit.

Compared to the previous instance two years ago, a year-long operation with a 100% net profit is not a particularly good deal.

If Simon were to make other investments based on the information in his memory, he could actually earn just as much in a year.

For example, buying Columbia Pictures stock now.

In 1988, Columbia Pictures released a total of 15 films, but the annual box office revenue was only $88 million.

That's right, 15 films, $88 million, with an average box office revenue of less than $6 million per film.

TriStar Pictures, a joint venture between Columbia and HBO, had slightly better annual box office figures; with the same 15 films, its total box office in 1988 was only $198 million.

It is rumoured that TriStar Pictures' cumulative losses since its establishment five years ago have exceeded $500 million.

HBO's parent company, Time Inc., to conceal this fact, even had to use accounting methods to allocate the losses to other departments.

Although news of Sony potentially acquiring Columbia had already spread, hampered by the studio's sluggish performance, Columbia's stock price continued to fall, dragging down the stock price of The Coca-Cola Company, which held a 49% stake in Columbia.

Columbia Pictures' market value has now dropped to only $1.6 billion, with a debt ratio of 100%. If it falls further, it will be insolvent.

However, Simon clearly remembered that Sony acquired Columbia in the second half of the year, with a final transaction price of $3.4 billion, more than double the current value.

Furthermore, Sony also assumed all of Columbia's $1.6 billion in debt, bringing the total transaction amount to $5 billion.

If Simon were to enter the market now and buy Columbia Pictures stock, he could also achieve a twofold return in the second half of the year, and with lower risk.

However, being in Hollywood, such an action by Simon would certainly trigger unnecessary speculation and even lead to an insider trading investigation.

With a large number of arbitrage trading magnates who had previously dominated Wall Street for years, such as Ivan Boesky and Michael Milken, falling from grace, federal investigative agencies, riding high on their newfound prestige, would certainly hope to ensnare a big fish like Simon Westeros, whose path to wealth was even more peculiar.

Therefore, despite numerous stock arbitrage opportunities, such as the recent RJR Nabisco merger and acquisition case and the upcoming Sony acquisition of Columbia in the next few months, Simon restrained himself from acting.

Although his opinion differed from most hedge funds on Wall Street that were bearish on the Japanese stock market, making money through the Japanese stock market posed no such risk.

Suppressing Japan's rise has been America's 'political correctness' in recent years.

Of course, the profits generated from speculating on Nikkei 225 index futures might not necessarily come from Japan, but that's not something Simon needs to worry about.

Constantly deliberating and calculating in his mind, Simon heard Jennifer relay James Raybould's suggestion and, after a moment of thought, quickly nodded, "Okay".

Increasing the position to 6,000 contracts still keeps the risk within a controllable range. However, even so, the expected return still struggles to satisfy Simon's appetite.

Funding remains a significant issue.

Simon does not intend to use loans to speculate on stock index futures, and the likelihood of obtaining a loan for such a reason is low; he also does not allow himself to take such risks.

Thinking this, something suddenly came to mind, and Simon looked up to ask Jennifer, "Is your father still at the company?"

Jennifer nodded, "It's six o'clock in the afternoon in New York, but Dad is still there. He called when you were having breakfast and said he'd wait for you".

The female assistant then picked up the phone on the desk, skilfully dialled a series of numbers, and handed the receiver to Simon.

After divesting Motorola stock, Westeros Company held shares in 25 listed technology companies.

The company held board seats in 16 of them, while in the other 9, it simply held shares without joining the board.

To avoid impacting the entire tech stock market during the Motorola divestment, Westeros Company issued a one-year non-reduction statement for its holdings in companies where it did not have a board seat, and a three-year non-reduction statement for companies where it did.

One year has passed since that announcement, and Simon can now fully raise more capital for operations in the Japanese stock market by divesting a portion of his technology stocks.

He spoke with James Raybould on the phone for half an hour. They roughly finalized a divestment plan for 6 stocks, three of which had performed relatively poorly over the past year or so, and three others that Simon had long confirmed he would divest, such as Apple Inc.

Simon had specifically declined to join Apple's board for this reason.

When Westeros Company bought Apple during the stock market crash, the company's market value was around $3 billion.

A total of $150 million was invested, and with a small increase in holdings last year, the ownership percentage just exceeded 5%.

Recently, Apple Inc.'s market value has increased to $5.3 billion, and Westeros Company's holdings have a book profit of over 75%, with a total holding value of $260 million.

Although Simon remembers that Apple's market value will exceed $7 billion in the coming years, he doesn't plan to wait any longer.

Of course, he never intended to sell all of it in the short term; a stake of around 5% is already a large proportion for a listed company, and selling too much at once would certainly severely impact Apple's stock.

However, with a total of 6 stocks, even if Westeros Company's divestment announcement causes some impact on the stock price, it can easily cash out $300 million within the next month.

After Daenerys Entertainment completes its financial audit, it can transfer another portion of funds to Westeros Company.

With over $500 million in principal, Simon can confidently increase his position in Nikkei 225 index futures to 15,000 contracts.

Although he could invest more, Simon also intends to know when to stop.

After cashing out over the next month, once the stock market stabilizes slightly, Westeros Company will continue to divest, but Simon plans to use the surplus funds to increase his holdings in companies like Microsoft and Intel, as these investments have even greater long-term returns.

After hanging up with James Raybould, Simon began reviewing several documents sent over by Daenerys Entertainment.

After reading Robert Iger's report on ABC's demand for Daenerys Entertainment to significantly lower its bid for the second season of 'Who Wants to Be a Millionaire?' and participate in advertising revenue sharing, Simon called Los Angeles.

It was only a little past 3 PM in Los Angeles, during working hours.

Daenerys Entertainment was able to earn $250 million from the first season of 'Who Wants to Be a Millionaire?', while ABC only got $80 million.

While Simon greatly hoped this profit distribution model would continue, he knew it was impossible.

The company had fully exploited the loophole created by the Hollywood writers' strike last year, and ABC wouldn't make that mistake again this year.

Fortunately, Daenerys Entertainment had already finalized a three-season contract for 'Survivor' with NBC.

Although 'Survivor' had even higher ratings than 'Who Wants to Be a Millionaire?', its scale of one episode per week for 13 episodes per season did not account for a large share of NBC's programming.

Thus, NBC did not experience as strong a backlash as ABC.

After discussing the negotiation plan with ABC, Simon had just hung up when the phone rang again, this time on its own.

He answered again; it was Sophia Fessey calling from Florence, Italy, where Gucci's headquarters are located.

On the phone, Sophia stated that she had secured 39% of Gucci's shares and was continuing to engage with other members of the Gucci family.

Although a basic acquisition agreement had been reached with the Gucci family last time, the Gucci family's shares were quite dispersed, and the specific price and other conditions still needed to be discussed separately by Sophia with the three branches of the Gucci family.

Sophia also predicted that, due to sufficient funds, she would likely acquire over 60% of Gucci's shares, even higher than the originally planned absolute majority.

Simon held the phone to his ear, talking to Sophia, and casually opened Nancy Brill's development proposal for the 'Teenage Mutant Ninja Turtles' video game, his expression immediately showing some surprise.

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