A protege of hedge fund legend Julian Robertson, Bill Hwang is a former hedge fund analyst who worked for the former's illustrious investment firm Tiger Management. Known as one of the "tiger-cub", Hwang is considered as one of the brilliant investment minds on Wall Street. He is the founder of Archegos Capital Management, based in New York.
Behind Achegos
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In the 1990s, Hwang entered the markets as a stock salesman at Hyundai Securities.
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Before Archegos, Hwang built the New York-based hedge fund Tiger Asia Management in 2001 with the support of Robertson. The firm focused on Asian investments and became one of the best Asia-centric hedge funds, which at its peak managed over $5 billion.
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In 2012, Hwang pleaded guilty to insider trading of Chinese bank stocks and agreed to pay $44 million to settle civil allegations. The Securities and Exchange Commission alleged that he used confidential information to short sell three Chinese bank stocks. After this, he shut Tiger Asia Management.
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The? Achegos
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In 2013, he founded Archegos, a Greek biblical word for leader, which is a family investment vehicle with leverage-based bets on US technology growth stocks and Chinese ADRs.
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According to a Bloomberg report, Hwang’s long-short strategy meant he took large positions in some of the biggest stocks via private derivative contracts which allowed him to take exposure more than his initial capital.
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The analyst managed around $10 billion of family money and made big bets on public stocks in the US, Europe, and Asia.
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Achegos crisis
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The firm held leveraged bets in ViacomCBS and Discovery stocks along with Chinese ADRs such as Baidu and Tencent. The crisis emerged when bets went south after ViacomCBS’ $3 billion stock broke apart, making brokers rush to exit the position and resulting in a huge margin call.
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On March 29, 2021, a prime broker for the company, Nomura, warned of a massive loss of $2 billion.
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Charity
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According to his tax filings, Hwang also has a charity called “The Grace and Mercy Foundation” with $500 million in assets. This causes generous tax deductions for Hwang’s investments.
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In 2020, Hwang donated a $20 million gain in Amazon stock, allowing him to avoid the capital gains tax.