How one can lose six billion dollars overnight by Polyanna Chu’s example
Polyanna Chu, known to the financial world as the richest resident of Hong Kong, the owner of the company Kingston Financial Group Ltd, has lost half of her multi-billion dollar fortune because of the regulator’s statement. This is an excellent illustration of the fact that the market is sensitive to various kinds of public statements.
In January this year, the fortune of Mrs. Chu was estimated at $ 12 billion; at the moment her assets are equal in value to $ 6 billion. The collapse of Kingston Financial stock price was due to the public statements made by Hong Kong’s regulator. The regulator warned investors that the company’s shares had been distributed among a small number of shareholders. In fact, this statement caused more than 50 per cent drop in quotations.
The Securities and Futures Commission of Hong Kong has released the information that only two dozen holders control about 90% of Kingston Financial shares.
Immediately after the publication of this information, the company’s shares fell in price by 17%. A few days later, the index provider FTSE Russell announced the exclusion of Kingston Financial shares from its indices that led to the second wave of the decline (for a total of 8.7%).
Casinos and hotels in Macau is still the main business of the company. The company also has other assets.
At the moment, the dynamics of Kingston Financial shares is the worst among the companies of the MSCI Asia Pacific index.
Pollyana Chu has lost the title of the richest resident of Hong Kong, giving her place to Pansi Ho – the daughter of the king of the gambling business in Macau. The second place belongs to Vivien Chen, Chairman, Board of Directors of Nan Fung Group.
The material was prepared with the participation of Katya Gordon,
a leading analyst of the brokerage company CT Trade