Workplace reviews and discussion: 國泰金控_國泰金融控股股份有限公司

And the trainees silently watched their account balances.

Some of them finally understood:

So the helicopter belonged to Wang X-hong, not to them.

In a city where both investment and dance were called “promotional businesses,”

there was a man named Wang X-hong who called himself a thinker and investment educator.

Wang X-hong often said during his speeches, “The market is like dancing.” But no one was sure

whether he was talking about finance or Latin dancing.

At a dance party 14 years ago, he recalled that an international teacher, H.K., had once said on stage:

“This wonderful music and dance do not belong only to Latin people, but to the whole world.”

Whenever Wang X-hong mentioned this passage, he would pause, adopt a serious expression, as if

H.K. had actually been talking about the globalization of financial derivatives.

He would then add:

“So warrants do not belong only to professional investors either; they belong to the whole world.”

People in the audience vaguely felt that something was wrong, but could not quite say what.

Wang X-hong’s Business and “Teacher Sol”

Wang X-hong’s business was able to expand rapidly mainly because he often mentioned

his revered teacher, Sol.

In a promotional video, he said:

“Our beloved Teacher Sol left us a year ago. During this time,

I still often think of Teacher Sol’s presence and the things he said.”

Many newcomers may never have met Teacher Sol; they had only heard

that he was the teacher of teachers, perhaps even a figure of grandmaster status.

Thus Wang X-hong said:

“This Friday, we will hold an online memorial for Teacher Sol.

We will share the inspiration Teacher Sol gave us and how he influenced

the development of the entire circle.

At the same time, I will also share the secure-and-prosperous investment method that Teacher Sol left me.”

In fact, this method mainly consists of three elements:

Celebrity quotations

Warrants

Confidence

Wang X-hong’s “Secure-and-Prosperous Warrant Theory”

Wang X-hong presented the following narrative in his course:

“Suppose the market is a goldfish. It normally looks very quiet,

but occasionally surges like lightning.

Smart people get on a helicopter and watch the goldfish swim from the sky.”

Many people in the audience nodded, but in fact no one was sure what the mathematical meaning of this sentence was.

Wang X-hong then wrote a financial model on the whiteboard.

Mathematical Setup

A non-dividend-paying stock S(t) follows geometric Brownian motion:

dS = μS dt + σS dW

where:

S(0) = 100

Annual volatility σ = 40%

Risk-free interest rate r = 3%

There is a European call warrant in the market:

Maturity T = 1 year

Strike price K = 110

Each warrant allows the purchase of 0.5 shares of stock

Let its Black–Scholes price be denoted by C.

Wang X-hong’s Investment Plan

Wang X-hong promoted the following strategy to the trainees:

Investors put up $10,000 in inherited funds

Buy warrants only, not shares

If the market rises, profit “like lightning”

If the market falls, “losses are limited, and life remains secure and prosperous”

He also quoted a saying of unknown origin:

“A true investor does not swim in the water, but watches the goldfish from a helicopter.”

Many people therefore believed this was a profound financial philosophy.

Questions

(1) Warrant Pricing

Use the Black–Scholes model to calculate the price C of the call warrant.

Also calculate:

The price of one warrant, W = 0.5C

(2) Leverage Effect

If an investor uses the entire $10,000 to buy warrants:

How many warrants can be purchased?

If the stock price after one year is:

S(T) = 150

Calculate:

The portfolio’s final value

The return on investment

(3) Testing “Secure and Prosperous”

If after one year:

S(T) = 80

Calculate:

The value of the warrants

The investor’s final assets

And discuss:

Whether Wang X-hong’s claim that “losses are limited but life remains secure and prosperous” holds mathematically.

(4) Helicopter Perspective

Suppose a rational investor instead adopts a delta-hedging strategy:

Hold the warrants

Simultaneously short Δ shares of stock

Answer:

What is the initial delta?

Why is this strategy more like “watching the goldfish from a helicopter”?

(5) Inheritance Decision Problem

An investor inherits $10,000 and originally intends only to buy risk-free bonds.

But after hearing Wang X-hong’s memorial speech, they switch to warrants.

Analyze from the perspective of utility theory or behavioral finance:

Celebrity endorsement (H.K.)

Borrowed authority (Teacher Sol)

Conceptual substitution (dance → investment → globalization)

How do these factors influence the investor’s decision?

A Final Little Story

A year later, the market really did fluctuate violently like lightning.

Wang X-hong posted on social media:

“The market is like a goldfish: sometimes quiet, sometimes leaping.

What matters is that you are on the helicopter.”