Chapter 6. Premus Fund (3)

The next day.

As soon as I got to work, Senior Dongho took me to the break room.

"Did you buy the Redhole Studio stocks we talked about?"

"Yes, I did."

"Really? Did you check the stock price?"

"Not yet."

Thinking about it, I immediately accessed the over-the-counter market on my smartphone to check the stock price. The stock I bought at 6,500 won per share had risen to 134,000 won. It had increased more than 20 times in just a few days.

Senior Dongho exclaimed as if in agony.

"You should have bought some when you told me!"

I looked at him with a bewildered expression.

"Didn't you say not to buy such a junk stock when I asked?"

"Who would have thought the new game would become so popular!? It's a total hit, right?"

"It is a hit."

The game released by Redhole Studio is called Battle Island.

Typically, FPS games involve performing specific missions, or fighting one-on-one or in teams. However, Battle Island is a battle royale style game where multiple players, not NPCs, fight until only one remains.

Initially, there were many negative opinions. Not only was it restricted to adults, but the game also required high specifications.

But the new approach worked!

Gamers were thrilled by the emergence of a completely different type of FPS. Without any significant marketing, it caused a huge sensation purely through word of mouth and rose to the top of the PC room occupancy rate, surpassing Overclock.

This was a once-in-a-decade hit in the entire gaming industry, and it was achieved not by a large game company but by a small to medium-sized game company that was still unlisted.

Redhole Studio became the center of everyone's attention.

A company that was worried about restructuring just a while ago now had to hire more employees and celebrate with performance bonuses.

As a result, the stock price continued to soar, and the unlisted stock market was drained of Redhole Studio's shares. There were no sellers, but the line of buyers was long.

"You should have told me if you had a source!"

"I did tell you."

"How much did you buy?"

"5 million won."

Senior Dongho's mouth dropped open.

"Wow! So it's over 100 million won now!"

These days, looking at the photos people post on SNS, it seems like everyone has at least 1 billion won, but 100 million won is still a huge amount for a salaried worker.

It seems that this is why people invest in unlisted stocks.

"Who told you about this?"

I couldn't say I saw it in the future, so I made up an excuse.

"A friend who works at a game company."

"Then ask your friend if it's still a good time to buy."

"Shouldn't that be a question for a customer to ask an analyst?"

Senior Dongho shook his head vigorously.

"No. I know because I'm an analyst, but they're all scammers. Even I'm down 40% on my stocks. The stock I bought at 80,000 won is now below 50,000 won! It's like people are trapped on the 80th floor, and the rescue team has no intention of coming!"

People often think that those in the financial sector are good at stock investing, but this is a huge misconception.

If it were true, all securities company employees would be millionaires.

I've heard that a famous analyst who frequently appears on economic TV and whose recommended stocks skyrocket is known as the Midas touch, but he ended up selling his apartment because his personal investments went wrong.

Senior Dongho still looked surprised.

"Wow! How did 5 million won turn into over 100 million won in just two weeks? I've never seen anything like this."

I patted Senior Dongho's shoulder.

"You'll see this more often."

I made some money, but I couldn't just be happy.

The more certain I became that I had returned to the past, the faster I needed to solve the Premus Fund issue.

* * *

After preparing the materials, I headed to the manager's office.

Manager Yoon Youngcheol greeted me with a smile.

"Oh, so you've finished the materials?"

"I think it's better if you see them directly."

He took the documents I handed him and flipped through them one by one. The manager's expression changed from moment to moment.

"What is this?"

What I had prepared was not a fund recommendation report but a report pointing out the problems.

"There seems to be a problem with the Premus Fund."

"What kind of problem?"

"The fund claims to invest only in high-stability bonds, but the return is too high."

"Interest rates in advanced countries have been continuously falling over the past few years. So, it's natural for the Premus Fund, which invests in bonds, to generate good returns, right?"

Bond yields and interest rates move in opposite directions. When interest rates fall, bond prices rise, and when interest rates rise, bond prices fall.

"But it generated the same returns even in years when interest rates rose. It consistently produced a fixed return regardless of market changes, and the specific trading details are not disclosed."

"That's to avoid position exposure, of course."

Well, that's true.

No fund manager would want to reveal when and how much they bought.

"However, as you can see from the materials I've prepared, the return is about 1% higher than other funds investing in similar products."

1% might seem insignificant, but when other funds generate a 5% return, a 6% return means a 20% higher return in terms of ratio.

In investing, stability and return are inversely proportional. There is no product that is both stable and has a high return.

Even if there are temporary differences due to market conditions, they are usually quickly resolved.

Manager Yoon Youngcheol's expression gradually hardened as he listened.

"So, what are you trying to say?"

"I think we need to verify whether the fund manager has really invested the fund assets in the stated bonds and whether the returns have been inflated."

"How? By asking them to submit their holdings and trading records?"

What would a liar say if you asked if they lied?

Of course, they would say they didn't lie.

"We need to verify it ourselves."

"Are you suggesting we audit the fund manager? DA Securities is a sales company, not the Financial Supervisory Service."

"Given that we are the exclusive seller and the fund is so large, if there is any insolvency, it could affect DA Securities."

Manager Yoon Youngcheol looked at me coldly.

"Hey, Han Miru. How long have you been with the company?"

"Six months now."

As soon as I answered, he shouted.

"What does a new employee who's only been here for six months know? Just do what you're told. I asked you to make a fund recommendation report, not to do something useless. Do you want the company to look ridiculous?"

"Um..."

This person is still the same.

I had expected this from the beginning.

There was no way he would accept a criticized report when the issue first arose.

* * *

I was practically kicked out of the manager's office.

The shouting could be heard outside, and everyone stopped what they were doing to look at me.

Senior Dongho took me outside.

"What did you say to make the manager so angry?"

"I just told him that there might be a problem with the Premus Fund."

Senior Dongho was confused.

"What do you mean? What's the problem with the Premus Fund?"

"The return is too high compared to other similar funds."

I summarized what I had told the manager.

Senior Dongho tilted his head.

"Isn't it common for fund managers to inflate performance before the fund launch?"

Who would want to invest in a fund that's losing money?

The better the performance, the better the fund sells, so fund managers try to maximize the value of their holdings and inflate returns to attract investors.

"Besides inflating returns, there's a possibility that the Premus Fund is hiding insolvency."

Senior Dongho looked puzzled.

"What are you talking about? The Premus Fund only invests in AAA-rated bonds issued by advanced country public institutions. Are you saying those bonds are insolvent?"

If a bond is rated AAA, it is safe unless the country collapses.

"But what if the Premus Fund invested in other assets?"

"Huh?"

"What if they claimed to invest in public institution revenue bonds but actually invested in junk bonds of insolvent companies and lost everything?"

"Junk bonds? Why would they buy junk bonds from such companies?"

"Because the returns are high. In the case of mezzanine, there's also the potential for additional returns."

Mezzanine refers to hybrid securities like convertible bonds (CB) or warrants (BW) that combine debt and equity.

While they are bonds, they can be converted into stocks or come with the right to receive new shares, so they can generate significant returns during a bull market. If an unlisted company goes public, the returns can be several times higher.

Senior Dongho looked at me with disbelief.

"What are you talking about? Does that make sense?"

"..."

This is a typical reaction.

Everyone thought the same way until the issue erupted. If I didn't know, I would have reacted the same way.

How can I make them understand?

Actually, it doesn't matter much to me since I'm planning to quit anyway.

Since I haven't written the fund recommendation report yet, I won't be held responsible for any mistakes.

But if I quit, someone else will write the report, and the Premus Fund will continue to be sold.

The same thing will happen again.

I looked at Senior Dongho.

He had to drag me out of the burning building, and as a result, he suffered a severe disability for life. If he had left me behind and escaped alone, he wouldn't have been injured.

I casually asked,

"Do you ever think about quitting the company?"

"Out of the blue?"

"Just asking."

"Do you know what my career goal is?"

"What is it?"

"To work until retirement and then leave."

It sounds simple, but it's a challenging goal. In today's world, it's hard to work until retirement unless you're a civil servant.

Senior Dongho emphasized,

"I'm going to bury my bones in this company."

"..."

Don't say that.

You might really end up burying your bones in the company!

If the same thing happens again, there's no guarantee that you'll survive. I need to solve this quickly to prevent that.

* * *

After being scolded by the manager in the morning, I wanted to go home.

Fortunately, Manager Yoon Youngcheol went out on a business trip right away. Back at my desk, I twirled a pen with my fingers and thought.

Should I just expose it and leave?

But to expose the insolvency, I need solid evidence.

Even now, fund managers who make money through short selling or put options often release reports pointing out specific companies' fraudulent accounting or insolvency to lower their target prices, but most of these reports are quietly buried.

Unless I'm at least a manager, who would believe a new employee's claims?

The problem will eventually come to light since it's a fraud, but I can't stay at the company until then.

I headed to the Risk Management Department on the 7th floor.

While there are departments that bring in money for the securities company, there are also departments that support and back them up.

If the Trading and Research Departments are the former, the Risk Management Department is the latter. Their main job is to monitor losses and transactions.

Given the nature of financial companies dealing with large sums of money, financial-related incidents and accidents occur frequently. There are few places as rife with fraud as the financial industry.

To put it bluntly, the difference between an expert and a fraudster is just a piece of paper.

Some investment techniques are close to fraud, and there are cases where traders manipulate stock prices in collusion with market forces.

Uncovering such issues is the job of the Risk Management Department.

Since their role is unique, they have less interaction with other departments. They don't have direct contact with the Research Department either.

In such a situation, the only person I can trust is a colleague.

Entering the department, I signaled to a familiar face.

"Yoon Ah."

Seong Yuna looked at me and asked,

"Ah! Miru. What's up?"

She stands out even without much effort, but that's not important right now.

Romance in the workplace is for the characters in dramas; I want to focus on my work.

"Can I talk to you for a moment?"

She looked at her watch and said,

"It's almost lunchtime."

"Would you like to grab lunch together?"

I realized it might sound too intimate.

"Ah! It's not for any other reason, just for work."

She nodded.

"Sure. Can I choose the menu?"