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For most people in China, May 21, 1992, was just another bland day, but at this time, for the people of Shanghai, particularly the stock market investors in Shanghai, it was a fascinating and passion-filled day because on this day, the Shanghai Stock Exchange announced a full liberalization of stock prices.[1]
Early in the morning, Chen Yuanming left his hotel room and walked down the street to the conference room set aside by Shenyin Securities for investors from rich and influential families or investors worth over a million yuan. The hotel where he lived was not far from that large conference room. However, after walking for ten minutes he saw a turbulent surge of excited shareholders. It seemed that everyone was unanimously waiting and preparing to rush onto the trading floor after the market opened to desperately fight for a chance at another stock market rally.[2]
Chen Yuanming was not surprised by such fanaticism. You should know that starting from April 13, each percentage increase or decrease on the stock market and each cancellation of restrictions on the low end of the market, was accompanied by a big wave of gains. In this manner, the Shanghai Stock Exchange Index broke through the 400-point mark on April 14th and soared to 623 points on May 20th. Now that the stock market was fully liberalized, as long as you had a little understanding of stocks, it would not be difficult to imagine how amazing the Shanghai Stock market appeared.
But was such a change acceptable to everyone?
With a trace of emotion, Chen Yuanming walked into the big conference room where he had been staying for the past two months.
“Yuanming!”
As soon as he stepped through the door, a voice called out to him. Chen Yuanming looked up and saw Xiao Yun striding towards him.
“How can you be late today?!” A strong shoulder embraced him violently and led him into the room. “Look! No one in this room could sleep today. Even that Lao[3] Sun arrived at half past seven.”
Lao Sun was a real estate agent based in Zhejiang and was among the league of million-yuan investors. However, he was usually busy with his own business and did not often visit the large conference room. But today, he was here early! It seemed that as long as one was not stupid, you would be present today. Chen Yuanming exhaled softly, this was truly the current craze.
This large conference room was originally the hotel’s presidential suite. Now it had been divided into seven or eight areas that were partitioned with flower pots and screens to provide privacy yet still allow the members of the various large families to communicate. Each compartment was equipped with leather sofas, coffee tables, bookshelves and a large-screen color TV.
You should understand that computers in 1992 were still legendary gadgets, and stock trading relied on manpower. Therefore, color televisions which could relay instant market information as well as traders dressed in red vests were the most convenient operating tools. In this large conference room, there were four red vests from Shenyin securities present. This was extravagant enough for an era where securities companies were short on personnel.
After taking two or three steps, Chen Yuanming and Xiao Yun entered their own box and settled on the sofa together. At this time, it was only a few minutes before the stock market was to open and the members of the big families who had just been chatting dispersed one after another to pay attention to the numbers that will soon appear on the TV. Xiao Yun bowed his head, lowered his voice, and asked, “How is it? How much will the market rise today?”
Half a month ago, Xiao Yun had wanted to sell his stocks. However, from the end of April to the beginning of May, all the newly listed shares had increased in value several times. In addition, with the current market situation, if he had sold them at that time, he did not know how much he would have regretted his actions.
Currently, Xiao Yun had placed most of his attention on Chen Yuanming. If the boy’s handling of the subscription certificate was because he was well-informed before, then at this period of time it was no longer a matter of being well-informed, but rather that this young man had an innate talent for stocks. On this point, Xiao Yun, who was still in the process of familiarizing himself with the market naturally wanted to hear Chen Yuanming’s opinions.
How much will the market rise, not whether the market will rise. From just this sentence, one could see people’s confidence in the stock market today. Chen Yuanming smiled, “It would be at least double.”
“Double?!” Despite being a little mentally prepared, Xiao Yun couldn’t help exclaiming, then he lowered his voice, “What would double? The stock price, or …”
“The Shanghai Composite Index[4].”
Chen Yuanming did not conceal this. It may have sounded a little shocking now, but to future generations who had experienced several bull and bear markets[5] this was not that surprising. It was just that Xiao Yun probably could not fully accept this declaration so after hesitating for a moment he chose not to argue with Chen Yuanming. Instead, he took a deep breath and sat down to wait for the market to open.
As soon as the time came, the entire room was quiet. Some people couldn’t sit still when they saw the numbers on the screen jump straight to 643. However, the market seemed to be testing something, and the trend was not immediately clear. This kind of stalemate and testing continued until about 10 o’clock when the market began to climb madly. The k-line[6] soared in a straight line. In just 20 minutes, the Shanghai Stock Index reached its peak and was positioned at 1365 points.
At this time, the big conference room had become a mess. The red vest personnel were running around. Some people beckoned and shouted, and cash poured into the stock market like a stream of water. Xiao Yun was completely unable to sit still. He stood up and sat down repeatedly. For the first time, he hated that he had spent all his money on purchasing subscription certificates. If he had money at this time, as soon as he entered the market, it would have doubled!!!
In the midst of this chaos, Chen Yuanming remained motionless. He slowly sipped on a cup of tea, and his mood was not as excited as it should be, in fact he was a bit melancholic. In his memories, how many times had he talked to people about what he would have done had he encountered the 1992-bull market. He had wondered how decisive and brave he would be. But what could one genuinely do? It was all just loose talk.
Because truly, in reality, all that was happening was enough to make people tremble in fear. This kind of fanaticism, this excitement, this kind of strong self-confidence in the trends was bound to spur everyone into going crazy and to start taking risks. If you were not familiar with the future, who could foretell what would happen in the next few days?
There was only a thin line between Heaven and Hell.
“Yuanming, I want to call my family again, maybe I can secure a few tens of thousands from them…” The first two buttons of Xiao Yun’s shirt had been torn apart, and there was a sheen of fine sweat on his face. Watching himself miss this opportunity, it was really …”
“Xiao ge.” Chen Yuanming interrupted the other person’s excited words and said quietly, “If you believe in me, wait a few more days, just a few days.”
This remark was like a basin of cold water, and Xiao Yun’s excitement was extinguished with a bang. After a few stunned seconds, he suddenly lowered his body, “What do you mean?”
“Nothing. Consider how far have the stocks have risen and then consider the listed companies. Are their products, their market, or even their own wealth worth so much?”
In a short sentence, everything appeared to freeze, and Xiao Yun’s eyes sank. The training he had received from the Courtyard[7] began to show. He did not understand stock trading, nor was he a real business expert, however, he had been instilled with military training from an early age. He knew how deceitful the battlefield was and how precious human life was. He also understood from an early age that the more dangerous a situation, the more calm he needed to be. No one could guess whether what lay ahead was a great victory or a trap set by enemies. Yes, indeed this was not a shopping mall.[8]
Taking a deep breath, Xiao Yun put down his arm and sat down on the other side of the sofa. At this moment, he suddenly felt that he was really old. With such a person from the younger generation around, how could he not feel old!
“How about it?” Chen Yuanming asked with a smile while looking at the expressions of the people around him.
“Hehe …” Leaning against the sofa, Xiao Yun’s expression slowly relaxed, “Since you have made a good point today, you have the final say.”
“Aren’t you afraid of being harmed by me?”
“Whether you are Guo Jia[9] or Ma Su[10], we will only know after a fight.” At this time, Xiao Yun actually had the mood to joke a little. He picked up a cup of tea and took a big gulp.
“Haha, then your majesty please spare me an execution[11]” Chen Yuanming also laughed.
On this day, the number of transactions on the Shanghai Stock Exchange reached 5,456, and the transaction volume exceeded 500 million yuan. The Shanghai Stock Exchange Index had doubled, and the bull market had arrived.
May 22, May 23, May 24 … It took only three days for the Shanghai market to reach the boiling point. On May 25, the Shanghai Stock Exchange was close to 1400 points, and the whole market was blood red. The upward trend of new shares had increased in value by 2500% to 3000%! However, while everyone was drunk on merriment, and millions of funds were flowing into the stock market, Chen Yuanming raised his hand.
“Traders.”
A moment later, a sweaty red vest ran to Chen Yuanming. He was surprised to see who was calling him. This was the youngest person in this conference room and had been the topic of discussion among several traders. After two months on the market, he had made no movements, neither buying nor selling. All day long he just drank tea and read newspapers in the conference room, just like a rich young master who had come out to play. They had thought he was here for decoration, but today he was making a move.
After thinking about it, the trader immediately put on a professional smile and willingly moved. After all he was just here for the commission, “Which stock do you want to buy?”
“Not buying.” Chen Yuanming shook his head. “Sell and clear the position.”[12]
The tip of the trader’s pen slipped, and a long stroke was drawn on the paper. He asked again in disbelief, “Do you mean … clearance?”
“Yes.” After passing his stock account card, Chen Yuanming turned to look at Xiao Yun who was stunned and smiled, ” Xiao ge, do you dare to follow up this time as well?”
Xiao Yun’s hand shook a bit, and the teacup in his hand clinked twice, but after a moment’s hesitation, he also gritted his teeth and said, “Sell!”
The trader looked at these two crazy guys in shock. Were they really selling during such a good rally?! Seeing that the trader was obviously dazed, Chen Yuanming raised an eyebrow. “What are you still doing here?”
Awakened by this shout, the trader suddenly burst into a cold sweat. At this period in time the transaction was not completed by a few keystrokes on the computer. A stock commission transfer order had to be filled in after which the sale price and quantity will be confirmed twice. The trader finally wrote out a seller’s contract while trembling. How could he not tremble? These were definitely the two largest orders he had ever handled in his short career.
After receiving the entrustment order form, Chen Yuanming carefully checked all the contents and signed his name on the signature line. On the opposite table, Xiao Yun looked at the entrustment order form for a long time, and finally signed his name with a stroke of a pen. After this signature he will be waving future profits goodbye. 100% profit every day. You should know that his principal was not ten or 20 yuan but millions!
The trader could not control the complex moods of the seller. So, after receiving the two orders, he rushed to the computer quickly. He couldn’t afford to delay on such a big transaction!
Both of them held relatively diversified newly listed shares and their offer price was not excessively high. The transaction was displayed almost as soon as the offer was made. At this time, Shanghai stock market implemented the t + 0 policy and the settlement could be completed in a timely manner on the trading day.[13] It did not take long for someone to invite them to input the password of their account number. After a few buttons, the delivery order came out immediately and all the stocks were sold.
Looking at the numbers on the delivery slip. Despite Xiao Yun’s identity, he couldn’t help but collapse a bit as he leaned against the back of the sofa. His eyes involuntarily turned to the TV screen that was still flashing numbers. There was still a gorgeous red[14], however for the time being these gains had nothing to do with him.
“Feeling remorseful?” Chen Yuanming looked at the other side in the direction of the Xiao Yun’s eyes and happened to see that the Shanghai Stock Exchange had broken through the 1400 mark. Though he had knowledge of the future, that was not the case for Xiao Yun. Yet facing such a huge profit, he had listened to a teenager who was practically a stranger. Whether it was out courage or madness, this act was still … quite terrifying.
Xiao Yun seemed to have lost strength and lazily flashed Chen Yuanming a wry smile, “A suspected person cannot be used[15].”
This was true temperament … Chen Yuanming also leaned on the sofa and stretched his waist, “You are not wrong.”
On May 25, after the market closed, the Shanghai Stock Exchange announced that “collective households” that jointly traded stocks were banned from buying stocks and were only allowed to resell the stocks they had originally bought. A trading point was to be set up at the Cultural Plaza to receive investors who needed to sell their stocks. As soon as the news came out, the city was shocked.
The next day, the market began to fall sharply. There was panic on the 27th, and the market continued its decline. As a new round of the subscription lottery was about to be held in June, investors were madly selling off their old stocks and praying that they could recover their previous losses before the new stock certification lottery. The entire market was miserably green, and amidst this terrible confusion, Chen Yuanming quietly leaped back onto the stock market and started to make small purchases.
At this time the assets in his hands had exceeded 30 million.
The author has something to say:
To explain again, the style of this chapter is realistic, which means that most of what happened in the text can be supported by historical data. The textual research itself is a very important part, and this book is based on the deduction of reality, i.e. “what if I was in that era”. To reiterate, all the information comes from Baidu.
Huh, okay, we were on the k-line in a bull market, but at this time it has suddenly become a bear market.
Therefore, the stock market is risky, and you need to be cautious when entering the market! Hello.
Translator Notes:
How thrilling. His 400,000 yuan became 1.2 million yuan and has now turned into 30 million yuan. Wooosh!
[1] Prior to this time the government exerted strict controls over the stock market so stock prices never climbed too high or fell too low.
[2] A rally is a period of sustained increases in the prices of stocks, bonds.
[3] Appellation – Meaning old.
[4] The Shanghai Stock Exchange (SSE) Composite Index also known as SSE Index is a stock market index of all stocks (A shares and B shares) that are traded at the Shanghai Stock Exchange
[5] A bull market is a market that is on the rise and where the economy is sound; while a bear market exists in an economy that is receding, where most stocks are declining in value.
[6] A K-line diagram is a way to observe the stock market, and use its value in making short-term investments,
[7] Remember Xiao Yun is from a political and military family. Thus, he’s very disciplined. Additionally, the true established and influential Beijing families lived in traditional Chinese courtyard homes.
[8] Not a shopping mall meaning this was not a place where you could just go on a buying spree.
[9] A strategist. Guo Jia (170–207), courtesy name Feng xiao, was an advisor to the warlord Cao Cao in the late Eastern Han dynasty. Throughout his 11 years of service, Guo Jia aided Cao Cao greatly with his brilliance and foresight, and his strategies were instrumental to Cao Cao’s triumphs over rival warlords such as Lü Bu and Yuan Shao
[10] Also, a strategist. Ma Su (190–228), courtesy name Youchang, was a military general and strategist of the state of Shu Han in the Three Kingdoms period of China. Ma Su had conspicuous talent in military theories and was admired by the Shu chancellor Zhuge Liang. However, a tactical blunder by Ma Su at the Battle of Jieting resulted in Shu being dealt a huge defeat by Zhang He, a general of the rival state of Wei.
[11] In ancient times a failed strategist would possibly be killed by the emperor. (CY was joking here)
[12] Sell to close (clear) is a stock trading order that is used to exit a trade.
[13] In china, the T+0 settlement cycle requiring trades to settle on actual trade date, often within hours of execution. Settlement means paying for all stock purchases in full by the settlement date. America implements a T + 2 settlement policy.
[14] Around the world when stocks are gaining value they are written in green. When they lose value they are written in red. This is the reverse in China. Red is an auspicious color in China and means positive; green means negative.




[15] Idiom – meaning “if you doubt a person, do not use or employ him”
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So exciting! Thank you for the chapter
No. Thank you!!!
Thanks so much! I’m really enjoying this, can’t wait for the ML to show up.
wow, awesome, I learned something new today. I didn’t know that gains are shown in red in China stock market.
thanks for the notes;)
I also discovered this nugget while translating the chapter
Thanks for the update, dear translator! I love seeing Yuanming slowly making his way to becoming the wealthy tycoon we all see him as!
I kept refreshing the page, wanting to know what happens next! Really exciting! I’m glad Xiao Yun decided to trust him and didn’t get pulled into the down spiral.
Thank you for your translation!
Thank you so much!
What an exciting and informative chapter! I’m curious what MC’s next plans are considering he now has 30 million yuan :0 he’s really come such a long way
Thanks for the chapter ❤