I Became the Youngest Daughter of a Chaebol Family-Chapter 26: The Wolf of Wall Street (1)

It had been a while. I’d spent the past few days keeping others on their toes, busy running around.

Because building a hedge fund on Wall Street was no easy feat. Fortunately, as expected of someone who’d lived abroad, Ha Yeong-il was easy to communicate with.

“We’ll have to start with a boutique fund, I assume. I know a few friends I trust—do you have any specific criteria?”

His eyes carried anticipation, anxiety, and a touch of doubt.

And who could blame him? I mean, I might look a little mature for my age, but... I was still just a kid.

“If they’re trustworthy, you can bring them in—but let’s keep it under three people.”

A boutique fund refers to a small-scale investment fund. Often, it’s managed by families, and even when you include everyone involved, it’s designed to be a tight, elite group of fewer than ten people.

More people just makes things messier.

...Though in most cases, it’s because they simply can’t afford more.

I nodded and raised a finger.

“And there’s only one condition: loyalty. Not too cunning... and just dumb enough to be useful.”

“Hmm, understood.”

The fortunate part was that this was still a time when hedge fund regulations were minimal. Funds operated by small groups were exempt from a lot of SEC registration requirements.

—Tap, tap.

I tapped the table with my index finger and moved on to the next directive.

“We won’t be raising capital inside the U.S. for now, so don’t worry about onshore. Focus only on offshore. Was it Bermuda? If we register there, most of the regulatory headaches should disappear...”

Ha Joo-seong would handle liquidating the Japanese real estate. Then we’d launder it through a paper company, and funnel the cleaned money into the offshore fund designated for foreign investment. That would take care of the seed money.

Ironically, this part was the hardest. Making money is easy—but laundering it? That’s the real pain.

Which is why I left it to the seasoned Ha Joo-seong.

“Make the management company an LLC and register it in °• N 𝑜 v 𝑒 l i g h t •° Delaware. There are all sorts of tax breaks and incentives there. It’s pretty famous... you know that, right?”

In the U.S., laws differ by state, and Delaware is widely known as the most business-friendly. That’s why so many companies set up there.

It was a basic fact—but even that was enough to surprise Ha Yeong-il.

“...Father told me about you, but this is... honestly amazing.”

He stared at me with disbelief and admiration.

“Yup. I’m a genius.”

I gave a modest nod and smiled.

“...This isn’t something a ‘genius’ alone can explain. This is... whew.”

There was a glint in his eyes. I’d seen that look often on Wall Street—very familiar.

“Damn, this feels good.”

“Right?”

This is why I can never give up this game of money.

Once I felt he was mostly sold, I stopped holding back and started giving detailed instructions freely.

Now that he had decided to trust me completely, Yeong-il was speaking fluently in industry jargon, and we were finally having a proper conversation.

“I’ll handle the fundamental analysis and risk management. The rest, I’ll just pad in as needed.”

“...Didn’t we agree that I’d be the one directing this?”

“Sure, but we still need to dress things up properly. It’s not easy to wrap a genius’s intuition in layers of analysis, you know?”

“Hmm, fair point. Anyway, don’t forget to hire a real accountant for that part, got it?”

—Scratch, scratch.

Beside us, Lee Si-hyun was furrowing her brow and scribbling frantically in her notebook. She looked like she was putting in real effort to execute everything perfectly.

“For now, our fund will primarily run a long-short strategy. Let’s avoid short-only selling unless it’s really necessary.”

Yeong-il tilted his head.

“I thought you preferred more aggressive plays.”

“If it were my money, I wouldn’t care. But this is a fund—trust is everything. Investors hate aggressive strategies. They still expect high returns, which is a contradiction, but... long-short is basic enough that even an idiot can trade with it. So it’s got plenty of upsides.”

—Click.

I twirled my pen and considered my next order. I wasn’t sure how much he did or didn’t know yet...

Before continuing, I had a small question nagging at me. I decided to shift gears.

“By the way, is this the kind of work you originally did? You’re better at it than I expected... even if you learned from Uncle Joo-seong, you’re pretty sharp for a college kid.”

“...I can’t exactly match up to you, can I?”

He looked at me in disbelief for a moment, then cleared his throat and replied.

“Honestly, I’ve always wanted to start a hedge fund. I gave up after Dad smacked me once, though...”

“Hm. So you were a born recruit. Welcome aboard.”

Yup—this one’s got a few screws loose too. Even if the timing couldn’t be better to found a hedge fund, who in their right mind would try it without any backing?

“...”

After that, a brief awkward silence followed.

—Rustle, rustle.

Only the sound of papers flipping echoed through the empty room. Bored, I ran a hand through my hair and stood up.

Screw it.

I got up and decided to help my struggling secretary.

“Si-hyun, got any questions?”

“...Is it okay to ask?”

“Why not? Ask while you still can.”

Looking a little embarrassed, Si-hyun scratched her cheek with her index finger before finally managing to open her mouth.

New n𝙤vel chapters are published on freeweɓnøvel.com.

“So... what exactly is a hedge fund?”

“Ahem.”

From beside her, a suppressed chuckle slipped out. Her face flushed crimson, and she quickly waved her hands as if to insist she wasn’t that ignorant.

“I mean, I kind of know. It’s a fund, right? You invest other people’s money.”

Yup, she never fails to meet expectations.

A good secretary makes her boss look better.

I struck a dramatically kind pose and scribbled on a piece of paper with my pen.

Hedge Fund.

“Now then, Si-hyun, why don’t you read this for me?”

“I can read English, you know! It says hedge fund! I—I went to a decent university, okay...!”

“But not Seoul National, right? Compared to our Ivy League friend over here, you’re falling a little short, aren’t you, Si-hyun?”

I didn’t get in during my past life, but in this one, I fully intended to. So it’s fine.

“Guh...”

God, this is fun.

I really did pick a great secretary. Honestly, I chose her for her looks—but what a lucky break.

“Now then, Ms. I-Can-Read-English. What does ‘hedge’ mean?”

“Fence... safeguard... something like that. In investing, it means managing risk... That’s what I learned.”

Mhm, she’s learned more than I thought.

In most cases, switching your position in the market isn’t easy. That’s why you buy products that move in the opposite direction. That’s called hedging your risk.

You earn less when things go up, but you lose less when they go down. Like an insurance policy.

“But I guess you didn’t learn much past that?”

“Well... I did learn a bit about laundering dollars in Myeong-dong... But I didn’t have much time...”

“...Well, fieldwork is important too.”

I cleared my throat and decided to give her a proper explanation. Now that I thought about it—she really had been through a lot lately.

“If you bet on stocks rising, it’s a long position. If you bet on them falling, it’s a short position.”

Pure shorting—known as short selling—is when you sell what you don’t have, then buy it back later to return it.

“...I know that much.”

This translation is the intellectual property of Novelight.

“Alright then, what happens if you take both a long and a short position in different stocks?”

“You mean going long on a stock that’s rising and short on one that’s falling?”

“More precisely, you short a stock that’s overvalued.”

After a moment of thought, Lee Si-hyun replied.

“...You’d make twice as much?”

Exactly.

That’s how you make the money.

“And the kind of fund that makes money like that is called a hedge fund.”

“Wait, hold on a second.”

Looking like something had just clicked, Si-hyun tilted her head.

“But... doesn’t that have nothing to do with risk hedging? I learned that hedging is when you take opposing positions in spot and futures markets. Isn’t it only risk management if you take long and short positions on the same stock?”

That is how it’s usually taught.

“But still—wasn’t it hedged?”

“...?”

“Kidding. But actually, that setup does reduce risk.”

“How? They’re completely different stocks. Wouldn’t that double the risk instead?”

That’s how it might seem, but in reality, it reduces risk.

“In practice, individual stocks tend to move with the market overall. So if something bad happens to the market, both of those stocks drop together, right?”

“...Ahh.”

That’s how the risk management works.

If everything were in long positions, a downturn would mean guaranteed losses. But if some of the portfolio is in short positions, then that part turns a profit when prices fall.

“The key is which stocks you short. Overvalued ones can fall even during bull markets.”

And in bear markets, those same stocks tank even harder.

What if the shorted stock doesn’t drop? That just means the market is in an uptrend—and the long positions are gaining instead. So you still profit.

The result? It’s a magical strategy that earns steady returns in both bull and bear markets.

For now, at least.

“Hmm. From everything I’ve heard so far, it actually sounds pretty solid. But... I feel like there’s something missing.”

“What is it?”

“I just don’t think you’d be satisfied with something like that.”

Lee Si-hyun had an unshakable belief about me: that I was a dangerously unhinged genius.

Which, to be fair... was mostly accurate.

I shook my head as if I were stating the most obvious thing in the world.

“Si-hyun. If the risk is halved... then obviously, you double the leverage.”

She gaped at me, muttering in disbelief.

“...What the hell. No, I mean—if you hedge the risk and then pull more leverage, doesn’t that completely defeat the purpose? That’s just a gambler raising the stakes after lowering the odds...”

Isn’t it ironic?

These days, hedge funds take on massive risk and charge in like maniacs. They’re practically the definition of high risk, high return.

Which is why the truth is: hedge funds don’t actually have much to do with hedging anymore.

“It’s fine. I’m a genius.”

The heavens handed me knowledge of the future—what else would you call that, if not genius?

Smiling, I stretched my arm toward the sky like an actor taking the stage, and declared in an exaggerated, cheerful voice:

“High risk, high return! If it makes money, I’ll do it! That’s the true spirit of modern hedge funds!”

The difference between them and me is simple.

I’ll take the return—

—without the risk.