Two individual Japanese investors made a combined ¥2.56-billion ($25.7-million) buying J-Com Co. shares after a wrong sell order by Mizuho Securities Co. on J-Com's exchange debut, Dec. 8.
Takashi Kotegawa, a 27-year-old unemployed resident of Chiba prefecture next to Tokyo, reaped more than a ¥2-billion profit, according to a document he filed with the Ministry of Finance.
Tetsuya Ichimura, 24, a company director, made ¥563.8-million, his filing shows.
Mr. Kotegawa's windfall is the biggest from Mizuho's error so far reported by an individual investor. UBS AG, which made the largest gain by an institutional investor, said it will give up the ¥11.8-billion profit it made, bowing to pressure from the nation's financial services agency.
"I haven't decided how to spend it," Mr. Kotegawa, who had made ¥20-billion in September from short-term trading, said Saturday. "I'll decide that early next year." Trading in J-Com, an employment placement company based in Osaka, was suspended on the first day after a typing error caused Mizuho to place a sell order for 42 times more shares than J-Com had outstanding at as little as ¥1. Mizuho Financial Group Inc., Japan's second-biggest bank, said the error at its brokerage arm will cost the company about ¥40.5-billion ($406.2-million).
"On the day, I was so scared to see massive selling," Mr. Kotegawa said. "I didn't know what was happening." Mr. Kotegawa spent ¥3.44-billion to buy 7,100 shares of J-Com on Dec. 8, selling 1,100 J-Com shares the same day, and received ¥912,000 a share for the remaining 6,000 shares he owned in a settlement imposed by the Japan Securities Clearing Corp. to cancel the erroneous order, according to his filing released on Dec. 16.
Mr. Kotegawa said he'd followed J-Com's initial public offering and traded the stock through an on-line brokerage. The ¥20-billion he earned in September was from buying and selling Japanese blue-chip stocks, including steel makers and banks.
With five or six years experience in trading, mostly on a short-term basis, Mr. Kotegawa also takes knocks, easily losing ¥100-million, he said.
"Recently I feel tired of handling substantial amounts of money in short-term trading," said Mr. Kotegawa, who denied being a so-called day trader. "I feel pain and pressure."
Mr. Ichimura, an executive director at closely held Liquidflow based in Tokyo, spent ¥2.81-billion to buy 3,701 shares of J-Com on Dec. 8. He declined to comment on his purchase in a statement faxed to Bloomberg News from his lawyer, Hidekazu Kayawari, on Dec. 16.
Mr. Ichimura paid an average ¥759,661 a share on J-Com's Tokyo Stock Exchange debut, according to calculations by Bloomberg News.
On Dec. 13, he received ¥912,000 per share for the 3,701 shares he owned in a settlement ordered by the Japan Securities Clearing Corp., the filing showed.
J-com, which sold 2,800 shares in its IPO this month, increased the number available for trading to 3,660, according to data compiled by Bloomberg.
The three-day suspension of trading in J-Com shares was lifted on Dec. 14.
The stock has since climbed by its exchange-imposed daily limit each day, surging 39 per cent. The shares rose 16 per cent to close at ¥1.42-million on Dec. 16.