Rebirth of the investment era

“The GEM is pointing to 1221!”

Seeing that the GEM index once again hit a new annual high, and seeing that among the GEM constituent stocks, almost all the popular concept stocks in the early stage have surged sharply, driven by a large amount of funds, investors in the entire market are exclaiming: "The market has gone too far. It’s divided. Is this a bull market or a bear market? Can the Shanghai Stock Exchange Index be saved?”

"Judging from the Shanghai Composite Index and the 50 Index that continue to reach new lows, as well as the trading volume of the two cities, it is an absolute bear market."

"Judging from the trend and growth rate of the GEM this year, it is already in the bull market range, and popular sectors such as 'Internet Finance' and 'Mobile Games' and many core concept stocks have generally more than doubled their growth this year. Now, can this be called a bear market?"

"It should be considered a local bull market, structural bull?"

"I really didn't expect that the GEM would be so strong this year. It seems... I have to activate GEM trading permissions tomorrow."

"It must be opened. Now the active funds in the entire market are basically concentrated on the GEM."

"The main board has become like an antique and cannot keep up with the times. I have a feeling... maybe the GEM Index can catch up with the Shanghai Stock Exchange Index in the future."

"Can't you? The gap between the two is still more than 850 points."

"Nothing is impossible. If the market continues to follow the current trend, the GEM Index will catch up with the Shanghai Index by the end of the year."

“If the ChiNext Index really catches up with the Shanghai Stock Exchange Index, will the valuation be so high?”

"Stocks of companies in the emerging economic field cannot be valued according to the stocks of companies in the traditional economic field. Institutions have not clearly realized this, so in the past six months, the GEM market has been seriously shorted, so...it is really based on It’s really a misunderstanding for PE to speculate in stocks.”

"If you don't press PE, what should you press?"

"Future industry and company growth expectations."

"Yesterday, I carefully read the market analysis article that Fortune Road posted on the online forum in June. It really makes sense. I have decided that my future investment direction will be on the GEM. Don't look at Internet Speed ​​Technology, Fenda Technology, Huaqingbao, Changqu Technology...these stocks have increased 2 or 3 times. In my opinion, compared with their future growth expectations, their stock prices are still at the bottom at this moment."

"Speaking of one thousand, saying ten thousand, the flow of market funds cannot be faked. The core blue chips of the main board have absolutely no future."

"Yes, technology is the primary productive force, and GEM is the future."

"I didn't say anything, just go directly to the GEM. Even if many of the GEM constituent stocks are too high to intervene, I would just buy the GEM ETF directly on the grid, which is better than sticking to such a big blue-chip stock."

As more and more investors abandon the main board, they follow the trend and enter GEM stocks, chasing core popular stocks such as Wangsu Technology, Fenda Technology, Huaqingbao, Changqu Technology, LeTV, Huayi Brothers, Oriental Fortune... As time goes by, the growth gap between the ChiNext Index and the Shanghai Stock Exchange Index becomes larger and larger.

And just when this 'ice and fire' situation is getting more and more intense...

After the disclosure of the semi-annual report, the Waigaoqiao and Shanghai-Hong Kong Group's "Jingda Investment" were abandoned, which fell short of expectations. Gu Chijiang, the fund manager and company owner, saw the momentum, the GEM index rising to new highs, and many GEM stocks. The core popular stocks couldn't help but frown slightly and thought to themselves: "Is the market's valuation system really no longer working? Do the core assets of the main board, the blue chip stocks, really have no future?"

In his opinion, the core popular stocks on the GEM are soaring in the current market.

None of them have long-term value.

However, it happened that the ones he was not optimistic about were rising the most fiercely. Moreover, it was not a period of short-term speculation, but a continuous upward trend, and the attack intensity of big funds in the market was wave after wave. There is simply an endless stream of investors from all walks of life rushing to raise funds.

This made him seriously doubt that there was something wrong with his investment philosophy.

"Mr. Gu, through observation in recent trading days, in the market, the funds of large institutions on the main board are indeed constantly adjusting their positions into the GEM." While Gu Chijiang was deep in thought, Team Leader Lin in the trading room said, "In the liquor sector, Trend, in recent trading days, although the overall trend is still slightly stronger than that of the Shanghai Stock Exchange Index, it is still far behind the performance of the ChiNext Index. I feel that the style of the market has indeed changed. Should we... try Should we take a little more position in the core constituent stocks of the GEM to balance this style change in the market?"

"Is Team Leader Lin planning to go in and take over at this time?"

Before Gu Chijiang could say anything, Hao Weilai, a fund investment consultant and market analyst who was not on good terms with Team Leader Lin, had already said with a smile: "The current surge in Internet speed technology, Fenda technology, Huaqingbao, Changqu technology... these For the core popular concept stocks on the GEM, let’s not talk about their valuations. There is no check with a PE below 100 times. Analyzing these stocks from a technical perspective, it can be clearly seen that these stocks are already in the final risk game of speculation. At this stage, if you rush in to take over at this time, there is a high probability that you will not be able to eat the meat, and you will be beaten."

"and……"

"Even according to what the market says, the concept of 'new economy' must be valued according to the new market."

"Then these stocks, the most optimistic ones, can support 50 times PE, which is 4 times higher than the main board on average, which is about right? But what is it now? Generally it is more than 100 times... This is no longer the so-called 'new market, new valuation'. It is a pure bubble. After so many years of development of A-shares, there is no bubble that will not burst."

"At this time, going in to chase the GEM is basically the same as chasing Huaguo Petroleum at 6,000 points in 2007."

"Looking at the liquor sector, although it has not risen much for the time being, it is definitely at the bottom. It is difficult to compress the valuation downwards. I think... it is very unwise to abandon high-quality chips and chase bubble chips."

"Mr. Hao thinks that the blue-chip stocks and blue chip stocks on the main board still have a bright future?" Gu Chijiang doesn't feel that it is necessary to chase after the high point of market sentiment and hot concept stocks that have risen several times. Cang's good idea, he tilted his head and asked Hao Weilai with a smile.

Hao Weilai nodded and said with a smile: "Value investing is not a lie. I think the GEM bubble will burst, and core blue chip stocks, white horse stocks, and even many blue chips have excellent performance on the main board and still have good future performance growth expectations." Stocks will definitely experience a reversal.”

"Among them, the liquor sector was the most severely suppressed by the market in the early stage, and its valuation was also the lowest."

"I think it is the long-term investment sector with the greatest investment potential in the future market development, and I also think... at this time, we should not give up."

"The future prospects are very beautiful, but we must also be able to survive into the future!" Team leader Lin did not agree with Hao Weilai's view. "The market trend has proved that the GEM is indeed the most profitable sector in the two cities, and... …Big funds from all walks of life in the market are indeed continuing to flow into the GEM.”

"The most important thing about investing is to follow the trend."

"I think... at this time, what we need most is performance. We should not have the idea of ​​'the world is drunk and I am alone', nor should we turn a blind eye to market trends."

"essentially……"

"Since July 16, we have increased our positions in the liquor sector on a large scale."

"Although the liquor sector has outperformed the Shanghai Stock Exchange Index as a whole, under the market expectation of 'reversal of difficulties', the overall trend is still lower than this expectation."

"And, especially since last week."

"Observed from the market of Jincheng Fenjiu and Qianzhou Moutai, the funds involved in various funds are also continuously flowing out. The pressure position in front of the market is locked, and there is no way to get past it. In other words... the liquor sector, if you want to It is simply unrealistic to become stronger independently.”

"On the other hand, we have a partial position in LeTV, and its trend is several times stronger than that of Jincheng Fenjiu, the largest holding of our fund."

"It is true... LeTV's PE valuation, whether static or dynamic, is at least six or seven times higher than that of Jincheng Fenjiu from an analysis point of view, but the current market style is like this, and all funds are abandoning traditional , and if we don’t embrace the ‘new economy’, our performance will not improve at all.”

To be honest... he doesn't like the market trend in the past six months either.

I also don’t understand the underlying logic followed by various funds in the market that continue to speculate on these so-called ‘new economy’ bubble stocks.

But he knows that the most important thing about investing is to follow the trend.

Now that the market trend has been unfolding for half a year, and the signs of a breakthrough in the main line of the market on the GEM are becoming more and more obvious, and the money-making effect of the aggregation is getting stronger and stronger, there is no reason to continue to turn a blind eye, even if you don’t agree with the logic. It is also necessary to adjust positions appropriately to balance the relationship between the two styles of the market, so that the fund performance will not be too miserable, seriously lagging behind the market conditions, and damaging investor confidence.

Gu Chijiang listened to Team Leader Lin's words.

Knowing that there were huge differences between the two people in terms of investment philosophy, he couldn't help but think for a moment and said: "From the actual trend of the market, the upward trend of the GEM is indeed stronger than that of the Shanghai Stock Exchange. What Team Leader Lin said makes some sense. , but... although I don’t understand short-term speculation, I also know that once a stock or a sector reaches the climax of emotion, it is basically not far from adjustment and end. "

"I admit that after the wave of emotional hype is over and the adjustment is completed, the market style may still develop centered on the GEM."

"But at this moment, chasing prices at high levels...is really inappropriate."

"How about this……"

Gu Chijiang paused and said: "When the next opportunity to adjust positions comes, that is, the opportunity for a change in market sentiment, we can appropriately increase our holdings of core popular stocks on the GEM and balance our positioning style, but before that …Let’s keep our original positions unchanged for now!”

"After all, when you are mentally disturbed, you tend to make more mistakes."

"Mr. Gu..." Hao Weilai wanted to say something else, but Gu Chijiang reached out to plan his words.

Team leader Lin glanced at Hao Weilai who was hesitant to speak. Knowing that Gu Chijiang had made up his mind, he stopped talking. He nodded lightly in response, sighed secretly, and couldn't help but continue to sit in front of the computer, observing the two people. The market situation continues to evolve.

During the same period of time...

The same divergent scene as inside Jingda Investment also occurred in many large private equity and public equity institutions, and even in the self-operated investment departments of large financial institutions.

The Shanghai Stock Exchange Index and the ChiNext Index are showing an extreme tearing trend.

The internal analysts and fund managers of these large investment institutions were suddenly divided into two factions. The trend investment trend quickly rose, while the value investment trend fell into a trough again, and even began to be ridiculed by many analysts, saying that in the country 'Value investing' is simply an evil path.

Thanks to the rapid rise of "trend investing" and the temporary destruction of "value investing".

A large number of retail investors and institutions who were trapped in the blue chips of the main board began to cut and adjust their positions one after another, entered the GEM, chased hot stocks, and participated in the speculation of hot money.

In this atmosphere...

GEM refers to popular core stocks, which are becoming more and more popular, and are related to 'new economy, new valuation', as well as macro-level 'financial technology', 'financial innovation', 'intelligent terminal equipment revolution', 'mobile Internet', The core concepts of the future "new economy" such as mobile games have also been recognized by more and more large financial institutions, and more and more funds are going into these fields.

Finally, when the market closed at 3 p.m.

The Shanghai Stock Exchange Index rose 0.35% and remained almost unchanged, while the ChiNext Index rose 1.98%. The index point was fixed at 1226.36 points, setting a new annual high and being less than 100 points away from the all-time high.

While the GEM Index is rising sharply.

The 'Internet Finance' sector once again led the gains in the concept sectors of the two cities, with as many as 6 stocks hitting the daily limit, and as many as 12 stocks rising by more than 5%; the concepts of 'mobile games' and 'wearable devices' followed closely behind the 'Internet' After the concept of finance, the sector increased by nearly 3%, and it is still the core attacking sector for market funds.

Of course, except for the major sectors with the best performance and the strongest money-making effect.

The overall money-making effect of the market is not good, and the overall capacity of the two cities has not been significantly enlarged. On the surface... all the market performance of the current market is just a game of stock, not incremental support.

And, in this...

Coal, non-ferrous metals, steel, petroleum, chemicals, building materials, real estate... these pillar industries of the real economy have all plummeted.

The entire market conditions of the two cities and their styles.

There is an obvious trend of 'from real to virtual', from traditional fields to new economic fields such as 'Internet' and 'intelligent electronic devices'.

And, just after the close...

At a time when various financial media are reporting that the ChiNext Index has reached a new annual high, and retail investors are discussing how many consecutive boards this monster stock of Shanghai Steel Union can go and how far it can go, a report from 'Huatai Junan' A senior analyst publicly expressed his view that the future economy will develop from real to virtual, and investment opportunities will also develop from real to virtual.

For a time, it aroused the attention and heated discussion of the entire market, many well-known analysts, financial influencers, and fund managers.

PS: There will be follow-up, it will be later!