Counterattack starts with controlling probability

Li Hao sat in a small conference room at UCB, holding a cup of freshly brewed coffee in his hand, but his eyes were a little distracted.

The email sent by Xu Lei was still on his laptop screen, which detailed the recent stock price fluctuations of Noah Technology and the repurchase measures they had taken.

"It seems that things in the country have become tense." Li Hao whispered to himself, frowning slightly.

Although he has gone abroad, he cannot completely let go of the changes in Noah Technology.

The time difference makes his life seem particularly busy.

During the day, I listen to lectures and do data analysis in class, but at night I have to pay attention to domestic market trends.

He knew that Xu Lei and Chen Kai had taken emergency measures, but these responses were only temporary.

He must find a more long-term and effective solution.

While he was lost in thought, Professor Hall pushed open the door and walked in.

Hall was his doctoral supervisor. Although he was over 60 years old, he still retained the energy and sharpness of his youth.

He was wearing a simple casual jacket and had his usual easy smile on his face.

"Li, how is the research going today?" Hall sat down, picked up a glass of water and asked casually.

Li Hao came back to his senses and smiled politely: "It's going well, but I've been a little distracted recently."

He hesitated for a moment, then decided to speak frankly: "Professor, I need to ask you something that has nothing to do with research."

Hall put down his water cup, his eyes showing a hint of curiosity: "Oh? Tell me about it, maybe I can help."

Li Hao took a deep breath and quickly gathered his thoughts. "Recently, the stock price of my company in China, Noah Technologies, has been fluctuating wildly. Market sentiment is very volatile. We've taken some short-term measures, such as share buybacks and increased holdings, but I don't think these are enough to address the underlying issues."

Hall nodded slightly, seemingly unsurprised by these developments. "Well, there are often many complex factors behind stock price fluctuations. Since you mentioned potential issues, what do you think caused this fluctuation?"

Li Hao frowned and whispered, "I suspect some external forces are shorting the market and deliberately causing panic. Although we have taken some countermeasures, we still feel very passive."

After listening to this, Hall thought for a while and then smiled meaningfully.

"Lee, you know, I worked at a hedge fund when I was young. It was a very interesting experience. Our goal at the time was to use complex market strategies to operate on undervalued or overvalued stocks. There are some methods you can learn from to deal with this situation."

Li Hao's eyes lit up and he quickly asked, "Professor, what do you think we should do now?"

Hall leaned back slightly, an intriguing expression on his face. "When dealing with short selling, the most important thing is to understand your opponent and their strategy. This isn't a simple financial battle, but a combination of psychological and strategic warfare. First, you need to understand your own strengths—does your company's core business and financial situation have sufficient support?"

Li Hao nodded: "We are confident in this. The company's business model and profitability are very stable.

"

"Excellent," Hall continued. "Next, you need to use public market information to analyze the short sellers' capital flows and strategies as best you can. In particular, look for their weaknesses, such as their reliance on misleading information to create panic. If you can expose this information, the market will rebound quickly."

Li Hao nodded thoughtfully, picked up his notebook and began to write: "You mean, we should actively explore their weaknesses instead of simply using funds to fight them?"

"That's right," Hall said with a firm look. "In addition, you need a longer-term strategy: to build market confidence in your company. This goes beyond short-term financial statements and includes your future plans and strategic direction. The market needs to see your long-term value, not just short-term cash flows."

Li Hao took a deep breath, and gradually gained some direction in his mind: "Professor, do you think it would be more effective if we built a more transparent communication bridge between shareholders and the market?"

Hall smiled. "Of course, transparency and trust are the cornerstones of any market confrontation. If you can proactively release clear and credible announcements, allowing investors to see your true value, and at the same time stabilize the situation through concrete actions, then those short-selling forces will be thrown into disarray."

"I understand." Li Hao nodded. "We need more than just defense. We also need to fight back with information and confidence."

Hall smiled with satisfaction. "Excellent! This is the mindset of a good strategic manager. Li, you've already got a clear direction. Now all that's left is execution."

Li Hao stood up and shook Hall's hand. "Thank you, Professor. This is very helpful to me."

Hall smiled slightly. "You're welcome. I believe you can handle these problems, and I hope you can learn more from this experience. Not only for Noah Technology, but also for yourself."

When leaving the meeting room, Li Hao felt much more relaxed.

He already has a clear framework for dealing with it.

What we need to do next is to communicate with Xu Lei and Chen Kai to turn these suggestions into practical strategies.

At the same time, in the luxurious conference room of the top hotel in Beijing, the atmosphere was low and tense.

Several men in suits sat on both sides of a long table, each of them looking extremely focused.

"Today's trend is pretty much what we expected. Repo funds have started to take effect and market sentiment has eased somewhat."

A trader was typing on the keyboard, his eyes always fixed on the screen.

The man sitting at the head table looked to be in his early fifties. He crossed his hands on the table and calmly analyzed the situation. "There has been a tentative return of funds to the market. This is a good thing, but it also presents an opportunity for us."

A young man nearby couldn't help but ask, "Boss, we've been pushing down the stock price. Now that the market has stabilized, what's the next step? Should we exit?"

"Exit?" The man raised his eyelids and sneered, "Do you think we're working so hard to drive down the stock price just for these petty profits? Our goal is to accumulate shares."

"Accumulate funds?" The young man looked confused.

The man didn't answer directly. Instead, he tapped his fingers on the table, his tone gradually becoming lower. "Noah Technology's fundamentals are fine. Short selling is just a chess game we set up."

"The purpose of pushing down the stock price is to make the market lose confidence in the stock, causing retail investors to panic sell and institutions to hesitate. When the stock price falls to our predetermined range, we will gradually start to accumulate shares and take all these low-priced chips into our arms."

"But after market sentiment improves, will our stock accumulation be noticed?" another trader raised the question.

The man shook his head, a shrewd look in his eyes. "No. Once the market sees signs that the stock price has stopped falling and is recovering, retail investors will think it's capital support and investor confidence has been restored. We just need to create enough false impressions, such as disguising the increase in holdings as buyback funds, and we can successfully complete the accumulation of funds. The key is to conceal our true intentions."

"What is our plan after the accumulation of funds is completed?" the young man asked.

The man pointed at the stock price curve on the screen, a sneer playing on his face. "Once we're done accumulating funds, we'll use short-term speculation to drive up the stock price and lure retail investors in. Noah Technology's market value is quite high. As long as the stock price rebounds, retail investors will think they've found a bargain and flock in. Then, we'll be able to gradually sell off our shares and exit smoothly."

There was silence in the meeting room as everyone digested his plan.

This operation not only involves complex fund allocation, but also requires precise grasp of changes in market sentiment. Any carelessness may backfire.

"But will Noah Technology's management just sit back and do nothing?" a trader whispered. "They might also retaliate through some means, such as further increasing repurchases or disclosing market information to rebuild confidence."

The man smiled, appearing confident. "Of course they'll fight back, but that's not a problem for us. As long as they keep spending money on buybacks, we can seize the opportunity to buy more shares. Their funds will eventually run out, and we just need to wait for their actions to slow down, so we can quickly switch to speculation and drive up the price."

"This is a psychological war; the key is to see who has the last laugh," he added, his eyes grim. "Noah Technology's executives are overconfident. They think stabilizing the stock price means stabilizing everything. But their buybacks are just propping up the market. The real market sentiment is controlled by traders like us."

"And what about the retail investors?" another trader asked with a smile, "Will they soon realize that we are tricking them into buying into the market?"

"Retail investors?" the man scoffed. "Retail investors are the most easily controlled by emotions. As long as we create the illusion that 'stock prices are rebounding and large institutions are entering the market,' they will rush into the market regardless of the consequences. We only need to gradually sell at high points, and the rest is none of our business."

Everyone in the conference room couldn't help but nod, obviously full of confidence in this plan.

"Then when do we start buying shares?" the young man asked.

The man looked at the stock price on the screen, then glanced at the timetable in his hand. He said slowly, "The stock price has begun to stabilize now. Once the selling pressure in the market gradually decreases, we can begin to act. Remember, everything must be done quietly. We must not let anyone notice our intentions."

He paused, his gaze sweeping across the crowd coldly. "Our goal is to complete the accumulation of shares within the next two weeks, then quickly manipulate the stock price to drive it up and sell it off. In this game, we must seize the initiative."