18 June 2020: Wirecard admits 1.9 billion euros may not exist
On June 18, 2020 German payments company Wirecard said its auditor, EY, could not confirm 1.9 billion euros in cash supposedly held in Asian bank accounts. The shares lost more than half their value that day and the CEO resigned. A week later Wirecard filed for insolvency, the first DAX member to do so. Journalists and short sellers had raised alarms for years.
The lesson: When skeptics raise detailed questions year after year, ask why the company never quite answers them.
What it meant for investors
$1,000 in Wirecard at the start of 2020 → $0 today, vs $2,092 in the S&P 500.
We start the clock at the start of 2020, the year it happened. Wirecard went to zero, so the position is worth nothing at all; the index turned the same money into $2,092.
What Wirecard teaches: When regulators and executives attack critics rather than answer their questions, take the warning seriously; an unverifiable cash pile is a red flag.
| Bought in | Price then | Worth today | S&P 500 would be |
|---|---|---|---|
| 2015 | $40.00 | $0 | $3,301 |
| 2018 | $95.00 | $0 | $2,519 |
| 2020 | $110 | $0 | $2,092 |
green = beat the S&P 500 · red = lost money
What if you bought Wirecard? Every starting year and the full story →
Could you have called it at the time? The wheel picks the year, you pick the position, ten seconds a pick.
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