A Wall Street Genius’s Final Investment Playbook
Chapter 182

Meanwhile, social media was being consumed by fear.

The desperate cries of small investors who blindly trusted Ha Si-heon and jumped into short selling echoed everywhere.

–What's a margin call? How can I avoid it? Please, somebody tell me……………

-They say if I don't deposit additional funds within 24 hours, I'll lose everything…………… is this true?

Margin call.

It was a word that sent chills down every investor's spine.

Unlike options, which merely trade ‘rights,' short selling involves investing by actually ‘borrowing' shares.

And inevitably, borrowed assets came with shackles.

Shackles called ‘collateral.'

Brokerages typically require 30% of the stock's value as collateral.

What if, during this, Valeant's stock price doubled?

Naturally, collateral demands would surge proportionately.

At this moment, brokerages ruthlessly demand additional collateral—this is the infamous margin call.

Small investors who recklessly entered short selling received margin call notices one after another, turning WSB into chaos.

Among them was a college student who jumped into short selling with his $15,000 tuition.

<Urgent Help Needed: Got margin called while shorting $VX. Is this real life?>

—I couldn't check calls while traveling overseas, but when I returned home, I received this email from my broker:

Required Amount: $4,125

Deadline: 24 hours

If unpaid: -$1,250 debt finalized (Total loss: $16,250)

They say ignoring a margin call means losing the original capital and even incurring debt—this can't be real, right?

In ordinary stock investing, this was unthinkable.

No matter how low a stock falls, you only lose your initial investment.

But short selling was different.

Ignoring a margin call meant investors found themselves buried in debt.

The college student faced only two choices.

Either scrape together $4,125 by any means necessary to defend his position.

Or liquidate immediately and swallow a total loss of $16,250.

Of course, the student's heart leaned toward the former.

-What about cashing out the credit card limit? I still have some credit left……………

The moment this question went up, comments flooded in.

-The first margin call is always easiest. Consider this the tutorial.

-Future storyline prediction:

1. 67 → 140: Credit limit destroyed

2. 140 → 200 (Margin $18,750): Parents' basement arc

3. 150 → 300 (Margin $43,125): Wendy's saga

4. 300 → ???: Overseas fugitive

-Debt collector: Looking forward to the next episode.

The problem was, this margin call was merely the beginning.

Because Valeant's stock was still soaring higher.

Yet, the student refused to give up hope.

-Sean's still holding his short position. If you hold with diamond hands, you might not just go to the moon—you could reach Saturn……………

Of course, holding until the end could lead to sweet victory.

However………………

-Can you really hold?

-Sean has money to handle margin calls, but you work at Wendy's.

-Margin call response comparison:

1. Sean: Which yacht should I sell?

2. You: How much for one kidney?

To survive this wasn't about ironclad determination—it required ‘cash.'

Only those capable of meeting margin calls could survive this game.

-But if you had puts, why short? Didn't you wash your brain?

-I thought it'd keep falling………….. premiums were damn expensive, and shorts didn't have expiration dates…………..

-Shorting because premiums were high? LOL, the best comedy of 2014.

Blindly gambling, trusting only Ha Si-heon and a falling market.

Now was time to pay the price.

Still, even now, the student clung tenaciously to a thread of hope.

-But what if I hold out? My student loan still has some limit left.

—  Checking student loan limits? Now it's really beginning LOL.

-The next margin call is really the last one: You’ll get ten more after that.

-Law of Short Squeeze:

"It's definitely going down now" → rises x2

"This peak makes no sense" → rises x3

"There's nowhere higher to go" → rises x10

-Volkswagen Chronicles: 340 → 1000. The German WSB guys went extinct then.

What if the stock really surged up to $1,000?

The mere thought of it was utterly terrifying.

By then, the margin call the student had to cover would be a staggering $213,000.

Failure to pay would leave him drowning in $172,000 of debt.

In Korean Won, these amounts were approximately 270 million and 220 million won, respectively.

His heart sank to the pit of his stomach.

‘Can I really hold on? Or rather, can I even gather the margin call amount? If I fail, the loss could become…………'

Even scarier was that there was no guarantee the loss would stop there.

Stock prices could theoretically rise infinitely.

What if this insane world………… drives the stock even higher?

This was why short squeezes were games of nerve.

Losses had no ceiling, while margin call notices relentlessly flew in.

Eventually, the college student waved the white flag.

<Paper Hands Declaration: I surrender>

Final status update.

Account: -$16,250

Self-esteem: -100%

Sean’s position: Still diamond hands

My position: Behind McDonald's

Brain cells: Not found (Error 404)

Following him, countless other small investors collapsed one after another.

But their surrender was only the beginning of another nightmare.

Liquidating positions meant returning borrowed stocks.

In other words, buying shares back from the market to repay their original owners.

In other words, this meant new buying pressure was emerging.

And this additional buying pressure drove Valeant’s stock price even more fiercely upward.

215.12……

219.34……

The stock effortlessly surpassed the $200 mark and continued its unstoppable climb.

393.12……

398.29……

Within just two days, the stock was nearing the $400 milestone.

This was the hellish ‘feedback loop.'

The more investors surrendered, the higher the price soared.

The higher the price soared, the more investors capitulated, fueling yet another surge.

Once begun, this vicious cycle was unstoppable.

Given how extensive short positions were, the destructive power was immense.

Wall Street speculators, sensing the unusual momentum, piled in, driving the madness to its peak.

The cries of retail investors never ceased.

-Lost $400k after investing $100k…………at least I've still got one kidney left.

-Speedrun completed: Went from student to homeless after three margin calls. The Wi-Fi next to the dumpster is surprisingly good.

-My broker just asked if I had any organs left? Kidneys? Already sold. Liver? Reserved after market close. Brain? Never had one in the first place.

-My broker said I should pledge my firstborn…………Kids? Not born yet. My future? Won’t exist. My genes? Let’s just stop here.

Meanwhile, Ackman looked down at his tablet with a satisfied smile.

"Trying to beat a short squeeze with more shorts—how foolish."

Shorts versus short squeezes.

In this fight, shorts were hopelessly disadvantaged.

Because this hellish feedback loop consumed everything like a black hole.

Small investors caught in this madness vanished like dust.

Those who survived were left walking toward a lifetime of unpayable debts.

But this wasn’t the end yet.

It was time to completely wipe out the remaining resistance.

***

Meanwhile, retail investors who had bet on put options were also burning with anxiety.

Although they didn’t fear margin calls, they faced a different enemy.

That enemy was ‘time.'

All options inevitably had an expiration date.

Monthly options expired on the third week of every month.

Only three days remained now.

If Valeant’s stock didn’t fall below the strike price by then, their investments would vanish into thin air.

But reality was cruel.

The stock had already surged past $500 and was climbing higher into the sky.

-Recruiting for D-3 expiration prayer group. Current attendees: 30 soon-to-be bankrupt traders.

-Wanted: Time machine.

Requirement: Functionality to go back two weeks.

Purpose: Liquidate puts, save my life.

Reward: Worthless puts about to become trash.

-Put option traders’ prayer: Oh sacred Theta, please grant us a circuit breaker today and deliver a mighty crash.

The investors desperately prayed, but…………

Deep down, even they knew.

In this endless upward spiral, a drop was merely a dream.

WSB was filled with furious outcries.

And the arrows of their rage pointed toward Ackman, the origin of this hell.

-Let’s overthrow the world where the 1% always win! Retail Investor Massacre Victims Association (1/30)

-Billionaires hitting "buy" buttons because their ego got bruised—is this reality?

-The market driven by supply and demand is over. Now it’s just Ackman’s game of "How many millions will I flex today?"

This was a rigged game from the start.

If this were Monopoly, Ackman had already seized the entire bank.

This was always the playground of the wealthy.

Small investors couldn't possibly defeat the billionaire Ackman.

Yet.

Even amidst despair, some retail investors found hope. They still had one savior left.

A ‘wealthy' ally on their side.

The last guardian of the short position, Ha Si-heon.

-It’s time for Saint Sean, guardian of shorts, to move—Sean hasn’t closed his position. Time to hold firm.

Wife: "Let's divorce." Me: "Sean’s still shorting."

Reasons we trust Sean:

1. He’s a genius.

2. He saw something.

3. He has a plan.

Retail investors firmly believed Ha Si-heon would find a way to topple Valeant.

A fatal flaw, hidden bad news, or even an entirely new strategy.

Because he was a genius.

— Ha Si-heon manages a 10-billion-dollar fund! He can fight back with money!

This wasn’t entirely false.

There were definitely ways to stop this momentum with capital.

For example, executing additional large-scale short sales. Borrowing massive stakes from major shareholders and flooding the market, creating excessive supply.

Or using ‘put options' to initiate a ‘reverse gamma squeeze.'

However, Ackman murmured to himself.

"There's no way he'll act now—at least not at this moment."

It was late November.

No hedge fund manager would willingly take unnecessary risks at this time of year.

"He’ll definitely wait until the new year."

There was only one reason.

The ‘seasonal effect.'

December is known for the so-called ‘Santa Claus rally,' a period marked by rising markets.

Companies inflate annual performance to boost stock prices, and fund managers polish their year-end reports.

Even small investors rush into the market, intoxicated by holiday bonuses and festive spirits.

All these factors combine, often pushing markets strongly upward at year's end.

This meant the current upward momentum was amplified by the Santa Claus rally.

Therefore, Ha Si-heon, who needed the price to drop, would want to avoid December.

In December, even the strongest weapon's impact would be halved.

Like shooting an arrow into a fierce headwind.

But what if it were January?

Recently, several experts had already voiced concerns about economic recession.

Slowdown in economic growth in China and the Eurozone.

Volatility in international oil prices.

Rumors surrounding the Federal Reserve's interest rate hikes.

All these factors were shaking the market's volatility index, sending clear danger signals.

Perhaps December's headwinds might turn into favorable tailwinds in January.

Therefore, if Ha Si-heon were to move, it would naturally be in January.

He would wait.

Definitely.

Ackman’s prediction was spot-on.

November's option expiry approached, but Ha Si-heon remained absent.

As a result, retail investors who had bet everything on November puts faced devastating annihilation.

-Account Login Error:

Balance [Not Found] Portfolio [Not Found] Will to Live [Not Found] Reality Check [Recovered]

— Tombstone inscription: “I believed in Sean.”

Cause of Death: November puts

<WSB Breaking News: Legendary Hero Turns Villain>

Crime: Diamond Hands. Victims: Entire WSB. Sean's stance: "I'm still short?"

-Sean would have about a $400 million margin call if he shorted all $1 billion. He runs a $10 billion fund, so he's probably just sipping lattes and wiring funds right now.

Retail investors' anger gradually shifted toward Ha Si-heon.

Of course, there were still those who never abandoned faith in him.

For instance, retail investors who had placed everything into December expiry puts.

— Brothers and sisters, Saint Sean has a plan. He's gathering dry powder right now. December is the promised month!

-Leaked prophecy of Sean: On the 69th day, Sean will strike down the longs! Those who hold faith in December puts shall reap abundance! (Source: Trust me, bro)

-Soon, Sean will borrow massive amounts of stock and create a tsunami of supply that even Noah's Ark cannot withstand. Praise be to the glory of that day!

But.

Even as December arrived, Ha Si-heon remained silent.

Only 15 days remained until expiry.

Retail investors' attitudes gradually turned hostile.

— Is he seriously just sitting there watching us burn alive?

-Still just waiting? Are you blind? Time to reset your problem awareness.

-While retail investors exploded, he was probably sipping tea in the boardroom saying, “Let’s wait a little longer.” Disgusting.

-Is it “justice” if only you profit by holding, while we're completely wiped out? Trusting your superhero cosplay was the greatest embarrassment of my life.

-If he's quiet until mid-December, we're grabbing torches and burning Pareto down. Don't be surprised then; get fire insurance beforehand.

Ackman read the mood and smiled victoriously.

No one was cursing him now.

At this rate, Ha Si-heon would become branded as the ultimate villain in this drama.

Feeling everything going smoothly, Ackman glanced contentedly at the calendar.

But just then—

Bang.

His portfolio manager burst through the door, breathless.

"H-Ha Si-heon made a move!"

Ackman's eyes widened.

It was still only the first week of December.

‘At this time?'

Ha Si-heon’s move was supposed to be in January.

This timing was incomprehensible.

But the PM’s next words shattered his predictions completely.

"H-Ha Si-heon… he filed a 13D disclosure after acquiring a 5% stake in Herbalife!"

"…Did you just say Herbalife?"

Ackman asked, stunned.

Yes.

The battlefield where Ha Si-heon revealed himself wasn’t Valeant.

It was Herbalife.

And Herbalife was… the stock where Ackman himself held a massive short position.

At that moment, Ackman felt a wave of dizziness.

Until now, Ackman had leveraged two principles to ensure victory.

-In the battle between shorts and short squeezes, short squeezes have the advantage.

-December traditionally experiences bullish trends.

However, these principles applied only to Valeant.

Because there, he was the ‘short squeeze.'

But what about Herbalife?

At Herbalife, Ackman was the ‘short.'

Meaning the board had been completely flipped.

It was the beginning of the counterattack.