Welcome back to the channel everyone today, i want to talk about how citadel have been hiding money overseas and lying about the true value of their assets under management and therefore also lying about the true value of their amc. Short position. So stay tuned and let's make some money, but before i dive into the video, i just want to give a massive shout out to the 4 100 of you that have currently ding that notification bell, because you guys are always the first to watch a new video As soon as it's released so guys be sure to drop a like down below subscribe to the channel and think that notification bell, if you haven't already so that you don't miss another video, just like this one and just a quick one before i dive in with The key information, if you haven't already i'd, really consider joining the private discord and becoming part of the team. That way, you get urgent updates and news, and due diligence about amc and other stocks before i even make a video and you get entered into a giveaway for 600 and i'm drawing the winner on the 28th of august, linked in the description below and now i Want to dive straight in with the key information, so is citadel's hedge fund, a harmless 35 billion dollar minnow or a 235 billion dollar killer shark.

At the end of last thursday's four hour long hearing on the forces behind the wild trading strategies of new york stock exchange listed gamestop, congressman jesus, garcia of illinois, our citadel hedge fund, billionaire ken griffin, how much money was managed by his hedge fund griffin replied. We manage approximately 35 billion dollars of assets and that's also confirmed by wikipedia possibly the most reliable source of information on the internet. That was obviously a bit of sarcasm, citadel llc, an american multinational hedge fund and financial services company founded in 1990 by ken griffin. The company operates two primary businesses citadel one of the largest alternative asset managers, with more than 35 billion dollars in assets under management.

As of october 1st 2020, so why is there an entire article figuring out that citadel actually manages a whopping, 235 billion dollars and how are citadel hiding money, overseas and offshore? But how is one of the largest alternative asset managers and one of the largest dark pool platforms and one of the largest market makers only managing a small fry amount of 35 billion dollars? When there's some funds out there? Managing trillions garcia then suggested that citadel was systematically important, since this might be construed to mean that citadel should be under heightened regulatory oversight. Griffin quickly responded with this. I believe that our hedge fund would not be in the category of systematically important or as systematically important, with some 30 billion dollars of equity is simply not at the scale or magnitude of a jp morgan bank of america or wells fargo. To make a proper assessment.

As to whether citadel is a little minnow swimming peacefully with the dolphins or a predatory killer shark regularly, looking for a fresh kill, it's important to pay attention to what happened between griffin's first response and his second response. In the first response, griffin said that citadel managed 35 billion dollars of assets in the second response. He changed this to 30, something billion dollars of equity according to the form adv that griffin's hedge fund citadel advisors filed on january 15, 2021 with the sec. His hedge fund is managing not 35 billion dollars, but 235 billion dollars in a 2011 sec final rule announcement.

Hedge funds were required to report regulatory assets under management, which includes not just the equity investors held in the hedge fund, but the additional assets the hedge fund had purchased, with borrowed funds known as buying on margin, and this is where citadel is so so sneaky. They may only have 35 billion dollars of actual cash, but they're leveraged up to the hilt and managing 235 billion dollars of actual assets. Hedge funds were also required to report assets held on behalf of foreign investors, since hedge funds manage all of the assets they hold and congressman. Garcia was clearly attempting to assess the size of citadel's systematic footprint in the u.s financial markets.

It would have behold griffin to explain that the gross amount of assets his hedge fund held was managing actually 6.7 times the figure he had provided, that is 235 billion dollars and not 35 billion dollars. Not to put too fine a point on it. But griffin was put under oath along with all other witnesses at the opening of this hearing, the same hearing with vlad kenneth lied and said that he had absolutely no hand in turning off the buy button on the gamestop and amc stocks. Citadel's hedge fund consists of a series of sub funds that have varying investment strategies and asset classes, including stocks, bonds and commodities.

A citadel hedge fund brochure that is also on file with the sec explains how leverage is piled on the sub funds generally invest on a highly leveraged basis, and the funds may leverage their investments in the underlying sub funds, and this is exactly that brochure with their Performance-Based fees, the types of clients, the types of assets, the method of analysis and much much more, all packed into one document. I'm going to digest this and potentially make another video on this in the future. If there's a lot of key information inside this document as well, according to citadel's form adv, a majority of its sub funds that hold the largest amount of gross assets are organized in the cayman islands, a jurisdiction priced for its secrecy. Those include the citadel multi-strategy equities master fund with 59 billion dollars in gross assets, citadel equity fund limited with 25.7 billion citadel kensington global strategies, with 17.3 billion and citadel quantitative strategies, master fund with 8.3 billion in gross assets.

Just one very quick diversion this report was prepared in february 23rd of 2021 so a few months ago. Obviously, in this report i've just read that citadel kensington global strategies fund has 17.3 billion dollars in gross assets. But if we look at this screenshot just here, nope, not that screenshot, they are now managing a whopping 43.5 billion dollars in that exact same fund and therefore, in a matter of what six months, they've managed to triple almost quadruple the amount of assets knowing actually triple The amount of assets in that fund, therefore, i can only imagine what ken griffin and cider have done with the rest of their funds. The fcc's form adv asked the question: what is the approximate amount of your total regulatory assets under management attributable to clients who are non-united states, persons, citadel answers more than 170 billion dollars or 72 of its 234.6 billion dollars of gross assets under management? Are foreign owned? It's difficult to assess what that actually means.

Citadel's hedge fund does not indicate in its sec filings that it has multiple foreign offices, so it could be managing assets for wealthy foreign individuals, but since it views its sub funds as its clients and many are located in the cayman islands, that 170 billion dollars could Simply mean offshore subfunds, in addition to citadel's sprawling footprint in assets under management by its hedge fund. It's the largest market maker when it comes to retail trading in u.s markets. According to griffin's opening statement at the hearing citadel securities, the market-making arm of citadel executes more trades on behalf of retail investors than any other firm congressman garcia asked if that represented 40 of all retail orders and griffin didn't dispute that figure. The dell securities has captured that retail trading market by generous payments for order flow to at least nine online brokerages.

Obviously that's going to be brokerages like robin hood, weeble td, ameritrade, e-trade and many others as well. Only fidelity and a few others don't accept payment for order flow. There is growing concern among lawmakers, but citadel securities motivation in paying for this order flow is to be able to trade against unsophisticated retail traders, known as dumb money on wall street in order to unfairly enhance its own bottom line. The disciplinary history of citadel securities unfortunately aligns with that thesis.

On june 25th, 2014 citadel securities was found. A total of eight hundred thousand dollars by its various regulators for serious trading misconduct, citadel paid the fines in the typical manner without admitting or denying the charges. The nyse alleged the following had occurred. The firm sent multiple periodic bursts of order messages at 10, 000 orders per second to the exchanges.

This excessive messaging activity, which involved hundreds of thousands of orders for more than 19 million shares, occurred two to three times per day. In addition, according to the new york stock exchange, citadel erroneously sold short on a proprietary basis, 2.75 million shares of an entity causing the share price of the entity to fall by 77 during an 11 minute period. Basically, they naked short of the company and caused a 75 drop in that company in only 11 minutes, basically just destroying that company. In another instance, according to the nyse citadel's trading, resulted in an immediate increase in the price of a security of 132.

Now, if that isn't market manipulation, i don't know what is, and they only got fined 800 000 for it imagine if they put 45 billion dollars into that trade and made 132 profit instantaneously, that's over, like 70 billion dollars of profit, and they got fined 800 000. Why wouldn't they do that? Every single day of the week on january 9, 2014, the nyse charged citadel securities, with engaging in wash sales 502 000 times using its computer algorithms. Our wash sale is where the buyer and the seller are the same entity and no change in beneficial ownership occurs. Therefore, they're just selling shares to and from themselves causing the price to drop as they lower the sale price each time, basically a ladder attack, as it says here, wash sales are illegal because they can manipulate stock prices up or down citadel securities paid a 115 000 Fine for these 502 000 violations and walked away on january 13, 2017, the sec settled a case against citadel securities for 22.6 million dollars in fines and disgorgements alleging the following had occurred.

Two algorithms used by citadel securities did not internalize retail orders at the best priced observed, nor sought to obtain the best price in the marketplace. These algorithms were triggered when they identified differences in the best prices on market feeds, comparing the sip feeds to direct feeds from exchanges. One strategy known as fast, fill immediately internalizes an order at a price that was not the best price for the order that citadel securities observed. The other strategy, known as smart, provide routed an order to the market that was not priced to obtain immediately the best price that citadel securities observed.

He then goes on to talk about some 2020 fines and the closing down of apogee their old dark pool. Citadel's hedge fund filings with the sec also indicate that some of the largest banks on wall street, such as jpmorgan, goldman and citigroup, are its prime brokers, meaning that it's highly likely that they and other globally systematic banks are providing margin, loans that have helped citadel advisors. Leverage its equity from 35 billion to 235 billion congresswoman maxine waters, chair of the house financial services committee, has promised to hold two more hearings on the structure of wall street trading. One hearing with experts from various disciplinaries and one hearing with federal regulators before those hearings occur.

It would be critically important for members of this committee to have a far better understanding of precisely how hedge funds, high frequency traders, dark pools and federally insured banks, backed by taxpayers, are interacting with the highly fragmented and non-transparent u.s trading markets. I also wanted to quickly go over a post from rizzo stonks who's been looking into all of these hedge funds names and how they've been transferring additional money to the cayman islands, for example, citadel just transferred another 14 billion dollars to citadel kensington global strategies fund limited. There's another one here: citadel wellington, llc that has 7.1 billion dollars. Citadel wellington, llc wasn't even mentioned in this report and therefore i think that citadel's true assets under management are even way higher than 235 billion.

A this 235 billion was calculated back in february when the kensington fund only had 17 billion, and it now has 45 billion and there's additional funds popping up all over the place with another 14 billion. Another 7 billion and a whole lot more guys be sure to. Let me know down in the comments below what you think about citadel hiding so much money in the cayman islands, and also about lying just how much money that they actually manage or actually own. Also guys, if you haven't already signed up for a trading platform, be sure to check out the link in the description below to moomoo to get some free shares.

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