A Wall Street Genius's Final Investment Playbook-Chapter 190

January 2015

This time of year was always a breathless month in the financial industry.

It was the season when investors managing hundreds of billions of dollars engaged in fierce negotiations with fund managers trying to attract their money.

However, at this moment, Wall Street was unusually unsettled.

“The current market trend favors tech-centered growth stocks. Our fund has already invested in leaders in cloud computing and fintech this year, and we’ve recorded a 12% return compared to last year. We expect even steeper gains going forward…”

Each fund manager boasted of last year’s performance,

Confidently promising better returns with their dazzling rhetoric.

Institutional investors, listening with their chins resting on their hands, responded indifferently.

“Hmm, I see.”

On the surface, they seemed uninterested, but once back in their offices, they would eagerly punch numbers into calculators.

To carefully compare each fund’s report card and decide where to allocate this year’s budget.

Normally, this process would have been a tedious numbers game.

But this year was different.

Among the comparable numbers, one “undisputed champion” stood out.

And that was, without a doubt, Pareto Innovation.

The fund led by rising Wall Street star Ha Si-heon, who had overthrown Ackman and made a grand debut.

Economic channels reported this news daily in competition.

[Can Ackman make a comeback?]

[There are reports that private equity firm KP has decided to urgently inject $10 billion into Ackman’s Maverick Investments.]

Ackman, who once reigned as the king of Wall Street.

But now, his fund Maverick Investments was facing a crisis due to massive redemption requests from investors.

Just before shutting down, a lifeline from a private equity firm barely kept it afloat…

[Many speculated that this incident might drive Ackman off Wall Street for good, but it seems he’s eyeing another chance.]

[But why would KP invest such a massive rescue fund?]

[They probably still trust Ackman’s capabilities. The recent losses stemmed from a rare event—the “rebellion of retail investors.” His other investments may still be quite attractive. That said, KP wouldn’t have stepped in without conditions. Most likely, harsh profit-sharing terms were involved.]

Thanks to that, he could barely breathe again.

But there were many doubts about whether Ackman could reclaim his past status.

[The scale of losses this time is enormous. Experts estimate the damage at around $13 billion.]

That was, quite literally, an astronomical loss.

However, on Wall Street, one side’s loss is always another side’s gain.

So everyone’s attention turned to one place.

[Then who benefited from Ackman’s $13 billion loss?]

[Judging from numerous verified posts, individual investors who put money into Herbalife and Valeant likely earned significant profits. But…]

Everyone already knew.

That the true victor of this battle was someone else entirely.

[It’s likely that Pareto Innovation scooped up the majority.]

That naturally led to the next question.

“So, just how much did they make?”

This question was repeatedly raised on Wall Street, but few knew the exact figure.

Because hedge fund profits are only disclosed to the fund’s investors.

However, there was at least one indirect clue hinting at Ha Si-heon’s performance.

And that was the employees’ bonuses.

“Have you heard anything about Pareto’s employee comps (performance bonuses)?”

In hedge funds, it was customary to divide a portion of the annual profits into employee bonuses.

Since employee skills directly translated to profits in this industry, generous bonuses were essential to attract and retain top talent.

Therefore, by estimating Pareto employees’ bonus amounts, one could roughly back-calculate Ha Si-heon’s earnings.

But the rumors circulating were hard to believe.

“What? An analyst got $7 million?”

“Yes, but…”

“Don’t be ridiculous! You must’ve misheard—maybe that was the PM.”

“No. They say the PM got $30 million…”

“What? Thirty million in bonuses? Are you kidding me?”

As the numbers passed from mouth to mouth, people’s skepticism grew even more.

Because the scale was simply beyond belief.

“They say this outdid Soros’ pound crisis earnings by several times?”

If those rumors were true…

Then Ha Si-heon’s net profit from this event would exceed $2 billion.

But that figure was hard to accept.

“That must be an exaggeration.”

“Maybe the employees are just bragging?”

At first, many doubted it.

But soon, the excessive spending habits of Pareto’s employees began to confirm the rumors.

“I’m going to die at Pareto! Once a Orca guardian, forever a Orca guardian!”

“I bought a house 10 years earlier than planned, so now I’ve got no life goals… What should I do next?”

“Tequila shots for everyone in this bar—five each!”

Every Wall Street bar was filled with wild Pareto parties and over-the-top bragging.

Those watching couldn’t deny the rumors anymore.

“Is it for real?”

The news spread across Wall Street in a flash. And those who heard it had one of three reactions:

“No way.”

Those who still couldn’t believe the amount.

“I should’ve invested back then…”

Those who waited too long for Ha Si-heon to prove himself and regretted missing the chance.

“So, when’s the next round of fundraising?”

And those desperate to invest with Ha Si-heon even now.

Ha Si-heon’s fund quickly rose to become Wall Street’s most sought-after investment destination.

However, getting into the fund was no longer easy.

Popular funds don’t accept investors just because they have money.

Every fund sets a cap on its assets under management and firmly rejects investments once the limit is reached.

Currently, Pareto Innovation manages a staggering $11.3 billion.

That was already a substantial amount, and Ha Si-heon had closed the fund based on that limit.

Would Ha Si-heon increase the fund’s size?

If so, by how much?

And what criteria would he use to select new investors?

“Has there been any announcement about additional fundraising?”

“There’s no sign that he’s even reaching out to institutional investors individually.”

“They say he won’t be attending this February’s summit either…”

Just when everyone was waiting for Ha Si-heon to reopen the fund,

This news came out.

<Pareto Innovation to Host 2015 New Year Party>

It was an announcement that Ha Si-heon’s fund would belatedly host a New Year’s party.

On the surface, it was to make up for not properly celebrating Christmas, year-end, and New Year due to recent events.

But.

Investors quickly saw through the underlying intention.

“Why now, of all times?”

And what’s more, those invited to the New Year’s party weren’t just existing investors.

Even potential clients who had not yet invested in Ha Si-heon’s fund—namely, numerous institutional investors and high-net-worth individuals—had their names on the guest list.

The meaning was clear.

A signal to attract new investors!

Of course, not just anyone would be able to join.

There would no doubt be some kind of conditions.

But what those were—only the attendees of the party would know.

And so, with everyone’s attention focused, the day of the party arrived.

#

The venue for this New Year’s party was the St. Regis Hotel.

As the main character, I headed to the hotel only once the party was well underway.

But the moment I stepped through the entrance, a wave of emotion hit me.

That happened faster than I expected.

In truth, hosting a party in the main banquet hall of this exclusive hotel had long been one of the top items on my bucket list.

A dream I never managed to achieve in my past life.

Because the St. Regis Hotel wasn’t just any luxury hotel.

A symbol of longstanding prestige and status, it was extremely selective about its clientele to maintain its brand image.

Normally, a flashy and ostentatious event hosted by a hedge fund with a “new money” image would never be allowed here…

But now, the St. Regis had willingly opened up its main banquet hall.

That alone was proof of the status I had achieved.

They’ve prepared everything just like I asked.

At the entrance to the banquet hall stood an ice sculpture I had commissioned, proudly on display.

It depicted the battle between David and Goliath—a custom order to commemorate my defeat of Wall Street’s “Goliath,” Ackman.

A bit on the nose, sure…

But so what?

It was a privilege afforded only to those who had won a decisive victory.

As soon as I entered the hall, my eyes were drawn to the champagne tower standing tall at the center.

Crystal-clear Baccarat glasses were stacked in layers, each one filled with the finest Dom Pérignon.

I had even requested that 24-karat gold flakes be sprinkled on the glasses’ surfaces.

I could practically picture the St. Regis staff frowning in disapproval while setting up such extravagant decor.

But.

Well, there’s a reason for all of it.

I shrugged.

If you’re going to spend money, do it right.

Especially when it’s time to flaunt the spoils of war.

Because the amount of extravagance at this banquet was a direct reflection of how valuable this victory had been.

A hedge fund’s fate, you could say.

Sure, I got a bit of pleasure out of pushing my own taste on all the snobbish old-money types…

But whatever.

I wanted to get closer to admire the champagne tower in detail, but that proved difficult.

The banquet hall was overflowing with people.

The RSVP rate for this party was a staggering 95%.

Usually, if the RSVP rate exceeds 80%, the event is considered a success—so this was practically a miracle.

Thanks to that, the hall was packed shoulder to shoulder, and the moment I entered, people surged toward me like a tidal wave.

“Sean! I’ve been hoping to meet you!”

“I read your Forbes article—congratulations on being named this year’s rising star of 2015. Honestly, there was no one else more deserving than you.”

“I’m not sure if you remember, but we briefly spoke at the previous summit…”

It was amusing to see even institutional investors—who normally acted aloof and prideful—now clamoring just to grab a hold of my sleeve.

A stark contrast to how they treated me just six months ago at the summit.

Then suddenly, the crowd pressing around me began to part.

Everyone was making way for a single individual.

Oh?

The person who appeared was an unexpected, familiar face.

Dex Slater from Shark Capital.

The “Great White,” who had gone up against me during the Epicura incident and suffered a crushing defeat.

“It’s been a while.”

The Great White greeted me with a short, curt nod before turning his head.

But it turned out he hadn’t come alone.

“Let me introduce you. This is Dan Loeb, and this is Saul Springer.”

I immediately recognized the two men standing on either side of him.

They were also prominent figures in activist investing—top-tier players on Wall Street.

In terms of ranking, you could say they were in the top 10.

“We followed the recent events closely.”

“You handled it in quite a creative way.”

They smiled as they mentioned my performance, but behind those smiles were sharp, calculating eyes.

Well, the man I’d taken down was Ackman—someone in the same league as them.

“You’ve got the kind of fresh thinking only youth can bring. Frankly, we’d never have imagined doing it that way.”

It sounded like praise on the surface, but there was an undercurrent of caution and analysis.

Well, naturally.

The top tier of Wall Street had solidified their dominance with an iron grip since the financial crisis.

But now, I had cracked that fortress with this incident.

Of course it would put them on edge.

“It’s getting a little hot in here—how about stepping out for some fresh air?”

They made an awkward excuse and led me out of the banquet hall.

Likely to avoid prying eyes and ears…

What do they want to talk about?

Once we reached a quiet spot, they made a rather interesting proposal.

“We have a private gathering where we share investment ideas every month or two. There was talk of inviting you to join. What do you think?”

“May I ask the name of the group?”

“We call it the ‘Triangle.’”

Of course.

I knew that name well.

Even in my past life, it had been spoken of in near-mythical terms.

And now they’re inviting me.

An unofficial yet enormously influential group said to include the most elite investors on Wall Street.

On the surface, it posed as a social club, but in truth—

It was more like a financial summit of world leaders.

Just as the political elite meet to align strategies before major global actions,

So too did the top players of Wall Street supposedly have secret meetings to test the waters before making major moves.

And now, they were inviting me.

“Of course, this isn’t a formal membership yet. The group values balance, so full consensus is required. But for now, we’d like to bring you in for a meeting.”

Which meant I wasn’t officially a member.

They intended to gauge my ability in the first meeting and decide afterward.

“I don’t turn down invitations.”

I accepted without hesitation.

There was no reason to refuse.

A chance to step into the highest-level financial discussions—who would say no to that?

Of course, they’ll want to test me…

But that was something I welcomed.

Whatever the challenge, I didn’t think I’d lose.

A hum escaped me without realizing it.

This isn’t bad at all.

The list of rewards I’d gained by toppling Ackman just kept growing.

Money, of course, wasn’t too shabby either.

Who would say no to $12 billion in profits?

But in some ways, the intangible rewards I was reaping now were even more valuable than that money.

Reputation, influence, position, and now even opportunities like the one right in front of me.

All of this would become a powerful stepping stone for my future.

But I had no intention of settling for just this.

If I had, I would never have fought this hard—burning through lives and cities to wage my war.

This was only the beginning.

The real, meaningful harvest was still ahead.

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