The Natural Gas War (4)

At month's end, the massive expiration of futures contracts always stacked together and volatility spiked.

Today was no ordinary month-end.

It was the end of December—year-end!!!

Year-end holds a special place in the financial markets. Institutions rush to liquidate positions so they can tidy their books, and fund managers scramble to lock in losses for performance settlements. Price volatility reaches its peak.

The problem was that most of those institutions and funds were sitting on long positions. When they all began liquidating at once, selling pressure exploded.

Natural gas futures opened the day down 9%.

Lee Jaseung's short position—until then nothing but losses—miraculously flipped into profit.

KG Group headquarters.

The moment Gil Donggyu heard that gas prices were falling, he bolted back to his office. He had bet his life on 120 billion won. He locked the door, lowered the blinds, confirmed he was alone, and drew a deep breath.

"I believed in you!! Lee Jaseung, you bastard! I believed!!!"

…Of course, the period during which he had actually believed in Jaseung had lasted only a single day. He had lived with glazed eyes, clinging to the promise that if he just held on ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠one more day it would all be over. Eyes shut, ears shut, interest shut off.

And now the price was really falling?

Then everything changes!

Like a stock addict he dove into the charts and spent the entire day buried in return calculations.

I need a 280% return. After fees, that lands me exactly 400 billion won.

A 280% return. Not an annual return—a quarterly return over just three months. The kind of number that barely appears once in market history.

But Lee Jaseung had cast the beautiful spell called leverage. Seven times leverage. Position size times seven. Losses times seven. And profits?

Times seven!

If gas prices fell only 40%, the return would hit exactly 280%.

Gil Donggyu hammered the calculator.

Three dollars. Just drop to three dollars!!!

Fall!

Fall!

Fall!

"Don't fall!!!!"

Traders holding long positions screamed. But contrary to their prayers, natural gas prices plunged as freely as a winter wind.

Every premise that had underpinned the long positions crumbled. This winter became the fourth warmest ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠on record. Shale gas production far outstripped demand. Gas companies, desperate to recoup the capital they had sunk into wells, refused to cut output.

So every time the Energy Administration report dropped, gas prices took another vicious hit.

"Somebody please kidnap the Energy Administration head and stop him from releasing these reports!"

"The report's out!!"

"Damn it!!!"

Curses erupted in unison. That was the pattern: the Energy Administration detonated a bomb, and the big investment banks poured gasoline on the fire.

"Goldman's cutting their price target all the way to $2.50!"

"$2.50? That's almost cut in half!"

Speculators piled into short positions, fanning the decline even harder. $4.50… $3.80… $3.30… $3.00.

The return Gil Donggyu had targeted was met and then some. Yet the slide refused to stop. By early March natural gas had crashed all the way to $2.70—a ten-year low.

Traders who had endured a winter of death finally dumped every contract and locked in their losses. One pulled off his headset and sighed.

"This quarter's completely wrecked. What do we do? Bonuses are a pipe dream."

"Still, we got out early. Lucky we kept the size small. The guys at NB Securities are dying. I heard they threw the firm's own capital into the long futures position."

Someone asked carefully, "What about Lee Jaseung?"

"…"

The traders who had barely crawled out of the crash all turned their eyes toward one place—the Makers dedicated desk. They clearly remembered the offhand remark desk head Kim Taeyoung had once made.

"They dodged the margin call by a tenth of a dollar, right?"

"Yeah. $5.50 was the exact top."

"It's down to $2.70 now—that's a 50% drop. With seven-times leverage, rough math puts the return at…"

"Th-three hundred fifty percent?!"

Everyone sucked in a sharp breath. Explosive returns you only ever saw in crypto markets. Of course profit only became real once you closed the position.

They crowded against the big glass wall, peeping at the Makers desk. Someone was on their phone. Someone else was nodding off. They looked nothing like people sweating over the liquidation of two trillion won in contracts.

"What's going on? Why are they so relaxed?"

At that moment Kim Taeyoung's eyes met theirs. The neighboring team head mouthed a silent question: When are you closing?

Kim Taeyoung strode over and yanked the blinds shut. Their view vanished.

"…Tch."

Curiosity still burning, they huddled together.

"Doesn't look like they're closing yet."

"Are they waiting even longer? Don't tell me they think the $2 level is going to break."

"Even if storage is full, there's a limit. Producers can't keep pumping forever in this environment. Better to close now than get greedy, right?"

"Exactly. Three hundred fifty percent is already insane. Three hundred billion turns into over a trillion."

Three hundred billion into a trillion. Everyone marveled at the number all over again. A once-in-a-lifetime investment opportunity—and the only people who had seized it were the Makers VIP members.

At first everyone had mocked the membership. Better to put three hundred billion in annual fees into a famous hedge fund; the returns would be better.

But who could say that now?

One single first investment had silenced every complaint.

"Must be nice. Makers members don't have a care in the world."

These days Gil Donggyu was enjoying a very warm winter. The weeks of heart-pounding suffering already felt like ancient history.

Heh heh heh. Everyone's ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠praising my eye for talent.

The line he heard most often now was how jealous they were.

"How much profit did you make again? Rumor says it's several times the capital."

"Haha. We'll know once we close."

"Lucky bastard. If I'd known, I'd have at least gone Platinum."

"I just trusted Jaseung."

But profit only comes home when you close. And Lee Jaseung remained completely silent.

Should I drop by? But I don't want to look desperate…

Curiosity won. He headed for the Makers office—only he put Han Juhyeong out front.

Lee Jaseung eyed Han Juhyeong's face, which was mottled with fresh bruises, and asked flatly, "You get in a fight?"

"The old man smacked me around."

"Why?"

"That fifty-billion investment of mine? I actually borrowed it against Hanyeong Auto shares. The old man found out."

"You deserved the beating."

"…Hey."

Han Juhyeong let out a long sigh.

"Lucky the position is in the green. Otherwise I'd be dead. So when are we closing?"

"Wait. It's still early."

"Unrealized gains can evaporate any second."

Close too late and the market could rebound; close too early and you leave money on the table. Of course even if a little profit evaporated, the record-setting return would still stand. Lee Jaseung frowned as if annoyed, but remembering that Han Juhyeong was a Black member, he exercised patience.

"We'll do it in a month."

"A month? Isn't that too late? What if it rebounds?"

At those words Jaseung's thin patience hit bottom.

"Han Juhyeong."

"Yeah?"

"If you're going to second-guess my exit timing, post a return like mine first."

"No, it's just… the lenders keep calling for repayment these days."

"That's your problem. Donggyu hyung put in 120 billion and he's staying quiet. Why are you the one pushing?"

Gil Donggyu, who had been sitting with dignified composure, flinched. The only reason he had stayed quiet was that Han Juhyeong was saying everything he himself wanted to say.

I'd really like them to start closing soon…

His target was exactly 400 billion. Closing at three dollars would hit the number dead-on. The heart that had once begged, "Just let me keep the principal," had completely changed. Missing the exit and falling a little short of 400 billion would sting too much. And with the price already down at $2.70 he felt even more uneasy. Closing meant buying two trillion won of contracts; that buying pressure would inevitably lift the price.

Wait a whole month? Is he that sure it falls further? But it could rebound. It already feels low enough… Waiting another month seems like too big a gamble, doesn't it?

What came out of his mouth was something else entirely. He grinned and pounded Han Juhyeong's back.

"Juhyeong-ah. Let's wait a little longer."

"Kek—hyung, you're not even nervous?"

"We decided to trust him once. Then we trust him to the end. That's what men do."

"As expected…!"

A week later the price was still hovering uneasily around $2.50, catching its breath after the long decline. Han Juhyeong asked, reading the room, "Cl—"

"Wait."

Another week later the price had, astonishingly, rebounded to three dollars. The chart formed a mocking V-shaped recovery that looked like a sneering mouth. Even Gil Donggyu started getting antsy. He asked with forced nonchalance, "Now we cl—"

"Hyung, why are you starting too? Did you catch it from Juhyeong?"

"No way."

One more week later Lee Jaseung summoned them both. On the desk lay the Energy Administration's latest report—the final hammer that would smash the two-dollar line.

Gil Donggyu read it and let out a small gasp.

"This is…"

The Energy Administration had played the powerful card of a "mandatory production halt." It was a signal that the situation was so severe a government agency had to intervene in the market directly. Terror flooded the gas market.

His eyes changed.

"You were waiting for this?"

"Of course."

"How did you…"

Where every worry had vanished, awe stepped in.

That's our Jaseung! He had a plan all along!

Hiding the pounding emotion behind a blank face, Gil Donggyu turned to the futures chart. The price that had been stagnating in a range took the Energy Administration's hammer and slammed straight into the ground in real time. $2.45, $2.33, $2.17… $1.98.

The two-dollar line broke.

The moment the support shattered, the spreading fear became unstoppable. Panic selling began.

And when the screen finally showed $1.82—a 67% collapse from the peak—Lee Jaseung stood up.

"Start closing."

Makers dedicated desk.

Desk head Kim Taeyoung gave the order with a grim face.

"We have to buy two trillion won of contracts total. Minimize market impact!"

To close a short you have to buy an equal amount in the market. Buying pressure of that size would by itself push prices higher. But…

"…Th-this is easy?"

"There's just too much selling."

They had timed the close exactly with the outbreak of panic selling! All they had to do was absorb the flood of contracts the market was dumping. Even restricting orders to below two dollars, they met the opposite side almost instantly.

"Selling felt like hell, but buying is pure heaven."

"No kidding. Never thought we'd scoop up two trillion this fast."

"I figured two or three weeks minimum. Took less than a week."

People clicked their tongues in admiration.

"Man, the hit-and-run is pure art."

They had entered precisely when the price hit its peak of $5.50. Then they held the position to the absolute brink of a margin call. And the moment panic selling ignited, they began closing.

It felt like they were possessed by a ghost.

"How is this ‍‍‌‌⁠​​⁠‌​​‍​​‍​‌​⁠‍‌‍⁠⁠‌⁠‌‍‌‍‌‌‌‍⁠​‌​‌​‌‍‌‌‌⁠‍​​‌‍⁠‌‌⁠⁠even possible?"

"It's exactly like watching that."

"What?"

"Master apple peeling."

"…"

As if peeling the skin with exquisite precision without ever touching the flesh. Not a scrap of waste—they had sucked every drop of sweetness out of the market.

When every trade was finished and the cash settled, people all around let out stunned sighs at the final number.

"Wow. I expected them to rake it in, but this… I've never seen a return like this."

"I have."

"Really?"

"In a book. Legendary Investors of Wall Street."

"…"

There was a reason for the fuss.

"Three hundred sixty-five percent return? Is that right?"

The only other place they had ever seen the number 365 was counting days in a year. To see it on a fund return! And this wasn't even the cumulative result of a ten-year long-term investment. It was the return of a single strategy executed in just five months!

"So what's the final profit?"

"One point three trillion won."

"Actual capital deployed was three hundred billion, right?"

Three hundred billion had come back more than fourfold—net of all trading costs and fees.

Which meant:

"Everyone who invested with Makers just hit the jackpot."

They deserved it. Enduring a strategy that dangerous to the very end required nerves of steel most people simply didn't have. But if you had simply trusted Lee Jaseung, that trust would have been repaid with enormous profit. That much was obvious.

Investors will flood into Makers now.

They might even be able to pick and choose at will. He looked at the other teams pressed against the glass, craning for a look inside, and thought:

I wonder if the business world is just as desperate as those guys.