How Softbank went from a tech investor to a big hedge fund

Softbank, the Japanese technology investor, appears to be gambling rather than investing these days. Shareholders are rattled. Matthew Partridge reports.

Masayoshi Son © Akio Kon/Bloomberg via Getty Images
Masayoshi Son lost $70bn in the dotcom crash
(Image credit: Masayoshi Son © Akio Kon/Bloomberg via Getty Images)

The Japanese conglomerate SoftBank, run by Masayoshi Son, is among the world’s “biggest and most controversial” technology firms, say Matthew Field and Hasan Chowdhury in The Daily Telegraph. While it is known to focus on “young, privately-held companies”, SoftBank is now revealed to have made large bets on publicly-traded tech companies too.

It purchased $4bn of call options on tech firms. These instruments, which allow it to buy a stock at a certain price, turned the firm into a “whale”: an investor so large they automatically drive the market up if they make a purchase.

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Dr Matthew Partridge
Shares editor, MoneyWeek

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

Follow Matthew on Twitter: @DrMatthewPartri