From our other sites
The story
As shares of semiconductor maker Kioxia Holdings went into a steep slide, the losses suffered by individual investors believed to be holding large margin positions became a hot topic on 5ch. Adjusted for the pre-split price, the stock reportedly climbed from around 25,000 yen to briefly top 70,000 yen, before crashing back down to the 8,400 yen range according to reports within the thread. Posters debated how margin trading works, the “two-story” technique of using NISA tax-free investment allowances as collateral, and whether such losses are really a zero-sum game.
What people said
Smart move.
Here comes the margin-call police.
8,400 yen.
Outstanding margin-buy balance: 50 million shares.
That's how many margin buyers are actually out there.
If it were for real, they couldn't tweet about it this calmly.
Even if it's just for fun, torching 50 million yen is still brutal.
Don't talk like Hiroyuki (the 2channel founder known for his detached, needling commentary).
Kioxia
By the time the award ceremony rolls around it'll probably have dropped even further — who's even going to show up to accept it?
Why did it climb that much in the first place?
People who have nothing but money, trying to achieve something with it, end up like this.
Whoever picks it up after it's already fallen wins.
Wait, do you actually think stocks are a zero-sum game?
If you're going to fake a sob story ("uso-matsu" — a made-up tale posted for attention), you could at least look up how NISA actually works first.
Full-leverage margin trading on top of NISA using cash holdings?
Can someone translate this into plain speech?
The NISA allowance can't be used as substitute collateral securities, so stacking a second or third "floor" on top of it isn't actually possible.
He probably just used the Kioxia shares he bought through NISA as collateral to buy more Kioxia on margin.
That makes it two floors — but if you call it three floors, what's the extra step supposed to be?
Kioxia bought through NISA
Kioxia bought with cash outside the NISA allowance
Kioxia bought on margin
Oh
it's this guy
He pulls in 60 million yen a year, so
this barely even stings for him.
Working a whole year for nothing is plenty painful though.
Nobody loses a year's salary for zero real gain and just shrugs it off.
Yeah, basically.
Using leverage lets you trade with more money than you actually have on hand.
You put up collateral first, and as long as your losses stay within that range, it doesn't technically become debt.
Exactly.
And if the stock price drops too far, your position gets force-sold and you're left holding the debt.
I'm holding it outright for the long term, but I'm nervous as hell about when it'll even get a price quote.
Well yeah, this is their guaranteed-win moment in the one-upmanship contest.
Background and Key Points of This Discussion
Margin trading is a system where you deposit collateral (margin) with a brokerage and can then buy and sell stocks for amounts exceeding your own cash on hand — but if the share price crashes, you risk losses beyond that collateral, triggering what’s known as a “margin call” (oitsusho). The “two-story” technique discussed in the thread — using the appraised value of outright-held shares as substitute collateral securities to layer a NISA position on top — runs into a snag, as reply 104 points out: the NISA allowance itself cannot be used as substitute collateral, so posters in the thread were divided on how far such a structure could actually go. There was also a misunderstanding among replies 32, 38, and 72 that treated the situation as a “zero-sum game,” even though stock trading involves both a seller and a buyer, meaning one party’s loss doesn’t automatically become another investor’s gain. Kioxia is a stock whose price swung wildly in a short period on semiconductor-market speculation, and that climate made it easy for individual investors’ margin positions to balloon — a key piece of background behind this whole episode.
※This article is excerpted and summarized from the 5ch (Nandemo Jikkyo G) thread “[Image] Kioxia Margin Traders Get Wrecked lmaooooo.”
Leave a Reply