Market News

(Bloomberg) -- A billionaire Chinese trader who made his name riding gold’s record-breaking rally has turned his sights to silver’s breakneck surge, with a bet on the metal’s collapse now worth almost $300 million.

Bian Ximing, who avoids the limelight and spends much of his time in Gibraltar, has made nearly $3 billion from bullish bets on Shanghai Futures Exchange gold contracts since early 2022. He has now built the bourse’s largest net short position in silver, according to Bloomberg analysis of exchange data and people with knowledge of his investments. They asked not to be named as the information is not public.

Bian’s big short comes with significant risk, and he has been forced to liquidate some positions at a loss in a volatile silver market. But he now holds a short that stands at about 450 tons of silver, or 30,000 contracts — so the metal’s sharp drop since last week has resulted in a paper gain of about 2 billion yuan ($288 million).

Including previous losses, Bian stands to make a net profit of around 1 billion yuan, based on his position and prices at the end of Tuesday. Silver is again sliding in Thursday trade and has tumbled more than 16% — almost certainly significantly increasing Bian’s proceeds.

Bian, through his brokerage Zhongcai Futures Co., began ramping up silver shorts in the final week of January, according to exchange data. SHFE does not detail the identity of individual investors behind brokerage accounts, but the people said Bian’s own bets — and products he directly manages for a small number of clients — make up the bulk of the company’s precious metals positions.

Bian and Zhongcai Futures did not respond to emails seeking comment.

Exchange data showed Zhongcai’s silver short position surged to about 18,000 lots on Jan. 28. It climbed further to about 28,000 lots on Jan. 30, when the metal in Shanghai reached an all-time high.

China’s Big Short

Bian’s bet comes as weeks of dramatic price swings are beginning to prompt market watchers to rethink their single approach to precious metals. While many institutional investors continue to view gold as a hedge against interest-rate shifts, central-bank buying and global uncertainty, silver’s surge is increasingly seen as an industrial rally pushed higher largely by speculative positioning — not economic and other fundamental factors.