A-shares seem to be falling unstoppably, falling again and again. Just finished the 3000 point defense battle, and now it’s time to reach the 2900 defense battle.
History is always strikingly similar. The slogan of each defense battle is the same, and the result of each defense is the same. In the end, it ended in failure. Thunder is rolling, and the market has completely lost confidence. Looking back on the several bulls and bears that I have participated in may be able to increase my confidence in the future.
The first bull market and bear market experience. Some people’s debut is the peak, and they are born in the good times of the bull market. When I first encountered the stock market, I encountered a long bear market. The stock market has been bearish for several years, from a high of more than 2,200 points in 2001 to more than 1,500 points in 2003, and a minimum of about 1,000 points in 2005. At that time, the stock market was not very good, but due to the factors of the major I studied, especially the influence of teachers and students around me, and my young age, I was interested in new things, so I stepped into the “big pit” of the stock market.
Although the exchange had been established for more than 10 years at that time, the stock market was still very new in China at that time. At that time, our school also specially cooperated with securities companies to hold a one-month simulated stock trading competition. That enthusiasm was extremely high at the time. Every day when I come back from get out of class, everyone doesn’t play games. When I get back to the dormitory, I check the floating status of the demo account immediately, and then go to the website to see the ranking. I remember buying all shares in Xiali Automobile (now a listed company that no longer exists). The next day it rose by more than 3 points, and my demo account was ranked third in the rankings the next day. At that time, I was even excited, thinking that I had a good level of stock trading. Unexpectedly, it fell in a mess within a few days, and the top 100 could not see a shadow. The top-ranked bobbins are amazing. They trade frequently every day, and they accumulate profits. The final rate of return is unbelievably high. However, because I have been holding the shares for a long time, the competition ended, and the result was naturally a “fame.” Since then, I feel that I am not good at learning, and I have to work hard and study hard.
I still clearly remember that there was a senior brother downstairs who was very good at investing in stocks. Every time we took a finance class, he liked to discuss stocks with our finance teacher between classes, predicting what stocks would rise by a few points tomorrow. In my impression, it seems that every time he predicts quite accurately, the technical analysis is rumored to be particularly powerful. Every time it ends with the failure of our teacher. This also made our teacher quite embarrassed. Technical analysis was very popular around us at the time. Because I don’t know how to read pictures, I also specially studied it. Since you want to learn technical analysis, you have to learn from the classics. When looking up the information, I found a classic book “Dow’s Technology” that is the originator of technical analysis. I don’t know how many people have read this book. Anyway, when I found out about this book, I was quite excited. I felt like I had discovered a “new world”, so I went to various libraries or bookstores to find this book. By chance, I saw the newly published “Dow’s Technology” in a bookstore, and I bought the book with a lot of money. At that time, it was like a treasure, and when I picked up the book, I couldn’t put it down and looked at it. But the more I look down, the more difficult it becomes to understand, and I always feel that this theory cannot convince me. But I also spent a lot of money to buy books, so I can’t give up halfway. I barely watched half of it, I couldn’t stand it anymore. The book has been dusty in the bookcase ever since. Really wasted a lot of money.
In the process of learning, I also discovered “Securities Analysis” written by Graham and Dodd and “The Theory of Reflexivity” by Soros. So I downloaded these two books from the Internet. Frankly, both books are particularly obscure, especially The Theory of Reflexivity. After reading “The Theory of Reflexivity”, I feel no different from watching it. Master Suo is indeed unfathomable. However, the book “Securities Analysis” left a deep impression on me. The three pillars of value investing—stocks being part of company ownership, margin of safety, and Mr. Market—have come to my mind ever since. Later, I happened to read another book, “The Smart Investor”, which is easier to understand. I feel like I have found a new world.
Due to the influence of the theory of the margin of safety, especially the theory in “Securities Analysis” to find companies whose net cash flow is higher than the total stock market value and companies whose stock price is lower than net assets, etc., I took these analysis tools to large Looking for a company for A-shares, I looked around and found that none of the good companies that everyone is familiar with meet this standard. This hit me a little bit hard. Especially after September 2006, when the bull market started, it was impossible to find companies that met the above-mentioned safety margin standards. At that time, the market was already hot, and there were reports of several times the profits of investing in stocks appearing in the media and even professional media. I was particularly impressed. In December 2006, the Financial Times reported that an investor bought Vanke’s stock for 8 yuan, and held it for about a year, with a five-fold increase. At this time, the students around were busy opening accounts to buy stocks. The big bookstore next to the school I often go to is also full of books on teaching people to trade stocks.
Due to the insufficient level, I was indifferent to these signs at the time, and I never thought that the stock market, which had been bearish for so many years, was about to attract a vigorous bull market. And I perfectly brushed past the big bull market in believing and doubting Graham’s theory. Unfortunately, it was a perfect miss with the big bull market. Fortunately, due to doubts and entanglements about investment theories, there was no in-depth participation, and a lot of losses were avoided. At the same time, the students of the same period pursued the newly listed bank stocks in the bull market. China’s major banks, which were considered technically bankrupt by major institutions in the world a few years ago, have become the most popular stocks in the bull market in less than four years. Today, looking at the stocks bought by classmates at that time according to the former resumption rights, in 15 years, the stock price has only risen by 34%, and the yield is unimaginably low. This also fully shows that a good company is not necessarily a good stock, and the margin of safety is critical.
Second experience of bull and bear markets. After experiencing the baptism of the first big bull market and bear market, coupled with the continuous learning on the road of value investment, I think I am still a lot mature, and finally I can deeply participate in the game of the stock market with relative ease. How can I think of a wave, and it will directly work from more than 6,100 points to more than 2,200 points in 2008 in one year. After a rebound in 2009, the stock market was in a tailspin. Especially in 2012, when the stock market had been down for five years. There are all kinds of bottom-out voices in the market. There are reforms and opening up, the founding of the country, and even the Opium War. Anyway, these so-called iron bottoms were finally broken down. After a long journey, how many young heroes lost their heads in sorrow. The bear market fell into mid-2014. In the despair of everyone, a new round of bull market has been quietly started. In particular, brokerage stocks rose particularly sharply. In December of that year, the company was established in Guangxi. On the way to the mountain, a colleague became the most dazzling star among us. This buddy invested heavily in Huatai Securities at that time, and in a few months, it doubled or tripled. Everyone admired him.
In this round, I had a premonition that the bull market was coming. At that time, whether it was my colleagues or classmates, there were gradually more discussions on stocks. In February 2015, the market was even hotter. Every day when we went to work, everyone was like chicken blood. The breakfast meeting in the dining hall in the early morning was all about stocks. Every day when I go to work, I will jokingly say, work hard and hurry up. At that time, the market was very good, and it was really fast. When the market opened at 9:30, the tickets held by everyone were basically a straight line, and they were directly closed until the market closed.
The market is so hot. Especially under the “Buffalo” theory of the then chairman of the China Securities Regulatory Commission, the stock market was soaring, and even the chief executive of a securities firm shouted the slogan “D gives me wisdom and courage, 5,000 points is not a dream”. Later, the market really broke 5000 points.
The Chinese bull market is really long for bears and short for bulls. In less than a year, the entire market began to reverse. At the end of May 2015, the broader market had already begun to plummet. What was particularly impressive was that I was waiting at an airport for a business trip. Due to the delay of the plane, the plane in the morning did not take off until the afternoon. The airport was still very quiet at that time, and everyone was waiting patiently. Unexpectedly, the stock market closed at 3:00, and immediately someone started to make trouble at the check-in counter. I was particularly impressed that day. On May 28, 2015, the Shanghai Stock Exchange A plummeted 6.5%. For this reason, I also posted a circle of friends, the plane was delayed, and now someone is making trouble. Looking back now, the hair tie time is 3:15 in the afternoon. The following bunch of threads asked, is the stock market plummeting, everyone is in a bad mood, and their emotions are on the verge of breaking out?
After this slump, the market continued to struggle for a few days, and after reaching a high of 5178 on June 12, 2015, the broader market has not returned since then. At the beginning of 2016, due to the activation of the fuse mechanism, the market was blown at the opening. At that time, everyone laughed and said that it was time to get off work before going to get off work.
In this round of the bull and bear market, as a heavy participant, he still managed to get out of his body, and in this round of the stock market cycle, Wuliangye, Yili, Shuanghui and Fosun Pharma all made a lot of contributions to subsequent profits.
The bear market experienced for the third time and two small springs. The third time, at present, there is only a bear market, no bull market, at most it is a small spring that has experienced two stock markets. The first small spring was from 2016 to the beginning of 2018, but this small spring was smashed by Trump not long after. The second Xiaoyangchun will appear from the end of 2018 to February 2021. Many value stocks in these two Xiaoyangchun have risen particularly well, and many investors have grasped the two rounds of small market.
Since the last big bull market, the stock market has been bearish for more than 7 years. Especially now that the broader market is plummeting, and market confidence has basically been wiped out. In recent years, various black swans have been flying everywhere. There is the XG epidemic that broke out in early 2020, the sweater battle and confrontation of big G2, the battle of Goose Five, and the possibility of nuclear war that everyone is discussing now. The world is a mess. Confidence in the market is completely gone.
As a heavy market participant, I think I have some experience and experience to participate in such a game. No matter how you think about it, you have been beaten by the market with a “blue nose and swollen face”. Forget it today, from last year to now, it is estimated that I will continue to work for DG for another few decades. At the end of July, I wrote an article about my experience, ” Respect the market, stay away from the market, and use the market “, which can be regarded as a portrayal of my own mental journey.
Looking back on the history of the stock market, bull markets are always born in pessimism, grow in skepticism, mature in optimism, and die in euphoria. Where is the market now?
Similarly, looking back at the history of human development, the giant wheel of history is always rumbling forward. Looking at the long history of history, the current setbacks are just a small episode. Should we continue to maintain a more optimistic confidence in the development of human beings, the development of the country, and the development of excellent enterprises when the market is pessimistic, even extremely pessimistic?
Time will tell!
Pictured: The three bull and bear markets experienced
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