'Nasdaq whale' SoftBank is said to have scored a $4 billion gain by betting big on tech stocks

A humpback whale breaching out of the ocean.

Reed Saxon/AP

• SoftBank has made a $4 billion gain on US tech stocks in a matter of months, the Financial Times reported on Monday.
• The Japanese conglomerate was revealed last week to be the "Nasdaq whale" responsible for snapping up vast amounts of options tied to US tech stocks recently.
• The news didn't impress investors, who cut SoftBank's stock price by about 7% on Monday.
• SoftBank CEO Masayoshi Son pivoted to investing in public companies as well as private businesses earlier this year.
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SoftBank has scored a hefty $4 billion gain by betting big on US tech stocks, according to the Financial Times.

The Japanese conglomerate was unmasked by the newspaper last week as the "Nasdaq whale" behind huge volumes of option buying in recent months, which helped to propel tech stocks to record levels.

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Investors weren't impressed by the reveal or SoftBank's unrealized profits. They slashed its stock price by more than 7% on Monday, wiping almost $9 billion off its market capitalization.

SoftBank founder and CEO Masayoshi Son approved the purchase of about $4 billion of options focused on individual tech stocks, exposing it to $30 billion of underlying assets, the Financial Times said. The company mostly bought call options — bullish derivatives granting it the right to buy the stocks at a certain price in the future.

SoftBank didn't immediately respond to a request for comment from Business Insider.

The $4 billion gain provides a much-needed boost for SoftBank. It stomached $660 million in derivative losses and posted a total net loss from continuing operations of $7 billion last financial year, according to its latest annual report.

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SoftBank's foray into options trading comes after Son shifted his strategy from mostly backing private companies such as WeWork and DoorDash to also investing in public companies such as Amazon, Microsoft, Netflix, and Tesla.

The conglomerate could continue "gobbling up" options, a person familiar with SoftBank's trades told the Financial Times. "The whale is still hungry."

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