Chapter 20. KNC International (3)

Lunchtime.

Kang Seon-woo sat in the company cafeteria with the development team members, poking at his food when Cha Su-yeon, who was sitting next to him, asked,

"Why aren't you eating?"

"I don't really have an appetite."

He hadn't eaten breakfast either, and his appetite was still poor.

Still, he forced himself to eat because he had work to do in the afternoon. As he was eating, Park Geun-hwi approached with his tray and started talking.

"I saw that it dropped by more than 10 percent just now."

"Yes."

He had lost his appetite after seeing that.

The sight of the stock price falling made him feel as if he was already full.

"I did some analysis on the stock you bought."

'Why bother?'

Park Geun-hwi spoke loudly enough for the other employees, including Cha Su-yeon, to hear.

"The PER and PBR are a complete mess. Not to mention the ROE. Nowadays, PDR is also used as an indicator, but it's hard to give a high multiple to this industry. It's extremely risky to leverage and take a long position in a stock without any consensus from securities firms. The most important thing in investing is risk management."

"I see."

Kang Seon-woo nodded half-heartedly.

'He could have just said it's a junk stock, but he's using all these terms to make it sound more serious.'

Park Geun-hwi continued with a worried expression.

"But are you really okay? You bought it on margin, and it's still plummeting."

The other employees were shocked by this.

"Really?"

"What can we do?"

"Is it really that risky?"

Park Geun-hwi gave advice as if he were a mentor.

"One of the maxims in stock investing is never to borrow money to invest. Especially, margin trading is almost a direct path to hell. When the stock price falls and the collateral value decreases, the securities firm will demand that you top up the margin. If you can't, they will immediately execute a reverse transaction, and your account will be wiped out."

The other employees asked in shock.

"Really?"

"Does that mean the account will be zero?"

Park Geun-hwi nodded.

"That would be a relief if it ended there. Do you know what the worst-case scenario is? If a large number of reverse transactions cause the stock price to plummet further, you'll have to pay even more. I've seen this happen a few times when I worked at Mirae Investment Securities."

Hearing this, Kang Seon-woo felt his already poor appetite plummet even further.

Whether he knew about Kang Seon-woo's situation or not, Park Geun-hwi continued to talk about the risks of margin trading.

Since the topic was stocks, everyone stopped eating and listened intently.

One employee asked curiously,

"What stock is it?"

"I'm not sure. I heard it was something with a 'K' in the name. Seon-woo, what was the name of the stock you bought?"

Everyone then looked at Kang Seon-woo.

'He knows but is asking on purpose?'

Kang Seon-woo said, as if he had no choice,

"KNC International."

"Oh, right! It's a company that does something with overseas resource development. It sounds good because it's a global business, but the risks are high. They often get scammed by local companies."

Another employee, who had been listening, asked,

"Could it rebound after a few days of falling?"

Park Geun-hwi laughed loudly on purpose.

"Haha! From my analysis, this decline is not just a simple correction but a sign of a major crash. Stocks that rise without reason will fall. They return to their original price. It wouldn't be surprising if it hits the lower limit soon. Selling immediately is the only way to minimize your losses."

"Sell immediately?"

Kang Seon-woo's question made Park Geun-hwi nod firmly.

"Yes. The decisive difference between a master and a novice in stock investing is the ability to cut losses. Masters are not afraid to cut losses, while novices, fearing the confirmation of losses, always miss the timing. It's because they think about breaking even. If I were you, I would sell everything immediately and never look at KNC International again. You can recover the loss with other stocks. As I've said many times, long-term investment in blue-chip stocks yields the best returns. If I were you, I would invest in stocks like U-Sung Electronics, TK Telecom, and SG Energy, which are among the largest market cap stocks..."

Park Geun-hwi continued to talk about stocks, and Kang Seon-woo's expression grew worse.

'Should I tell Miro to sell now?'

It seemed he would have to call and have a serious talk.

Just as he was thinking this, a female employee, who had been checking her phone, exclaimed in surprise,

"Oh! This, this..."

"What's wrong?"

Everyone looked at her in shock.

"It's the stock Seon-woo bought."

"What about it?"

'Has it fallen again? It can't be suspended, can it?'

The employee told him, surprised,

"It just hit the upper limit."

"Really?"

Park Geun-hwi chuckled.

"Did you see it wrong? It was down by more than 10 percent just now."

"No, it's KNC International."

She held out her phone for everyone to see. The other employees were shocked.

"Wow! It's true."

"Wow! Upper limit!"

"Seon-woo must be happy!"

"How much did you buy?"

"Total jackpot!"

Park Geun-hwi was flustered.

"Uh, why is it really...?"

But the person most surprised was the one who had made the investment.

Kang Seon-woo, checking his account, exclaimed in shock,

"Wow! What's happening to my stock?"

He rubbed his eyes, thinking he might have seen it wrong.

But it was indeed the upper limit.

The stock, which had been down by nearly 10 percent just a moment ago, had suddenly hit the upper limit.

The increase was over 40 percent!

In an instant, not only had he recovered his previous losses, but he had also gained over 10 percent in profit. He was happy, but also puzzled.

'Why is it rising?'

He didn't know the reason, but it was definitely the upper limit.

Kang Seon-woo raised his hands and shouted,

"Yes! Upper limit!"

Then he looked at Park Geun-hwi and asked,

"What did you say just now? You said to sell everything immediately and never look at it again, right?"

The employees turned their attention to him.

"Come to think of it, you said it would hit the lower limit, didn't you?"

"You also said to cut your losses."

Park Geun-hwi, flustered, couldn't speak properly.

"Ah, that was... "

He had been talking confidently, but the opposite result had occurred.

'What a ridiculous situation! Why is this trash stock hitting the upper limit?'

Park Geun-hwi searched on his phone. He noticed a new announcement that hadn't been there before.

"Huh? Cobalt mine?"

* * *

The demand for batteries has been steadily increasing due to the widespread use of smartphones and the expansion of the electric vehicle market.

As a result, the prices of raw materials for batteries, such as lithium, nickel, and cobalt, have also risen.

Among these, cobalt has seen the largest increase.

The international price of cobalt, which had been around $20,000 per ton, soared to over $50,000 per ton in a few years due to supply concerns.

This led to cobalt being called "blue gold," and companies began competing to secure it.

However, like most raw materials, cobalt is not mined in Korea, and the country relies entirely on imports. But an unbelievable event occurred.

A report revealed that a cobalt deposit had been found in a mine acquired by a Korean small and medium-sized enterprise.

The report was issued by the Netherlands International Resource Exploration Research Institute.

According to the report written by Professor Vincent van Horn, the estimated cobalt deposit was a staggering 1 million tons, the largest in the world.

Surprisingly, the company that owned this mine was a Korean small and medium-sized enterprise.

KNC International.

[KNC International secures cobalt mine!]

[Estimated deposit of 1 million tons, the largest in the world]

[Historic jackpot in Korean overseas resource exploration!]

[Did foreigners know the news in advance? Large-scale buying a few weeks ago]

The announcement and news articles caused a frenzy on the stock message board.

-Is this real?

-If it's real, it's a huge jackpot, isn't it?

-Foreigners already knew the information and started buying at below 2,000 won.

-No wonder foreign capital was flowing in!

-Damn, look at the information-gathering ability of foreigners.

-Even now, foreign buying orders are pouring in.

-Recently, cobalt prices have been crazy. 1 million tons?

-LOL, is this even possible?

-But a professor from a Dutch research institute wrote the report.

-What's the current price of cobalt?

-It's $46,000 per ton.

-What a blessing!

-From this moment, I'm going all in!

-You can't just buy it if you want to. Look at the buy orders.

-There are over 300,000 buy orders. If you place an order now, it will be processed after all these are cleared. But would anyone sell now?

-Will the limit be lifted tomorrow?

-No, no, no, 10 consecutive upper limits are certain.

-Congratulations to all shareholders!

-I want to buy! I want to buy too!

-Go! Cobalt, go!

The stock, which had been slightly declining, soared to the upper limit in an instant.

Despite the upper limit, hundreds of thousands of buy orders piled up, but almost no transactions were made. In other words, it was a situation where people wanted to buy but couldn't.

While looking at the news and message board, Seon-woo received a call from the office.

[It hit the upper limit today.]

"I told you there would be good news."

[Was this it?]

"Yes."

His voice sounded excited.

Of course, he had every right to be excited, given the sudden surge in the stock price.

I'm also a bit excited. I even ran around shouting a little earlier.

[When are you going to sell?]

"What to sell? It's just the beginning."

[Okay? I have to go back to work now, so I'll call you later.]

"Don't call. Just focus on your work. We can talk after you get off."

[Got it.]

* * *