Rebirth of the Capital Legend

"No, don't worry." Lu Xiangxiang also stared at the trend of the two markets and continued, "The fundamentals of the film and television media, Internet software, Internet applications, electronic information, and other industries related to the 'emerging industrial chain' are completely different from last year's bull market, or from a few years ago when 'mobile Internet' just broke out and 'smartphones' were fully upgraded.

Last year's bull market and the bull market trend of the ChiNext Index in previous years.

The reason why a number of industry sectors related to the main line of "emerging industrial chains" can produce a large number of ten-fold stocks or even dozens of times bull stocks, and the industry sector index can generally multiply several times and continue to outperform the broader market index is because of their continued improvement in fundamentals, the continued growth in future industry scale and space, and the continuous improvement in expectations.

Although we cannot say that the future of these industry sectors will definitely be pessimistic, at least the certainty is not that strong.

Moreover, after several consecutive rounds of stock market crashes, the historical trapped positions are too heavy.

In this situation...

If the market trend is to be reversed completely, it will inevitably require extremely abundant liquidity support.

However, the market liquidity, or the expected market liquidity in the next year or so, cannot be significantly improved if the macro liquidity cannot be further released.

In other words, the market is very likely to be in a stock game situation for a long time.

Since it is a market for stock-existing game, the speculation of funds in the market will become relatively cautious, and the risk appetite will also be obviously limited.

Also, any hype cannot be supported solely by emotions.

Speculation supported solely by emotions cannot lead to a sustained market trend. This is clearly evidenced by the fact that every time the "emerging industrial chain" line rebounded, it eventually fell back after the emotions subsided.

Since the risk appetite of short-term speculative funds will not continue to rise, and pure emotional speculation cannot last long.

Therefore, the hype of the "emerging industrial chain" line, its persistence and depth of spread are destined to be unable to compare with the "big infrastructure" main line with strong fundamental support, strong underlying logic, and the industry cycle is obviously in the rising stage, as well as the liquor, white appliances, medicine, consumption, and electricity industry sectors. In other words, the overall investment style of the market, once formed, will not be easily changed under the inertia of the trend. "

"Although the overall trend will not be easily changed, looking at the current market feedback, I am afraid that the hype trend of small and medium-sized stocks and micro-cap stocks may continue for a while." Yu Xiaolu thought for a while and said, "After all, with the help of short-term emotions, the hype and money-making effect of the market has already emerged, and the active capital flow in the market, especially the short-term hot money groups, has begun to concentrate on the small and medium-sized stocks and micro-cap growth concept stocks. At the same time, if the market investment risk preference continues to rise, the weighted main line areas that are currently in a wave of continuous rebound and have reached a relatively high level and basically have no room for flexibility are likely not the primary target of speculation for many retail investors and a large number of short-term hot money groups.

In other words, as the hype around small, medium and micro-cap concept stocks picks up, funds are concentrated in this area for speculation.

It is bound to siphon the liquidity of the main line of "big infrastructure", as well as the main lines of weights such as liquor, white appliances, medicine, consumption, electricity, petrochemicals, finance, etc.

But there is a temporary lack of liquidity support.

Even the main line of "big infrastructure" and a number of industry sectors related to the main line of weight have strong underlying logical support.

I am afraid that when active capital groups are attracted by small and medium-cap and micro-cap concept stocks, it will be difficult to continue to reach new heights and form a smooth upward trend.

So... I am worried about the weight main line and the 'big infrastructure' main line.

It is very likely that the price will fluctuate and weaken again at this position, forming a new platform fluctuation range. "

"If market liquidity remains constant, and the liquidity situation on the market, that is, the market turnover, cannot rise further in the near future, and the continued recovery in market investment sentiment still cannot attract off-market capital groups to enter the market..." Lu Xiangxiang said, "The market may indeed develop into what you said, and continue to form a situation of main line rotation, but I think... under the continued hot market speculation sentiment, and the stimulation of the visible improvement in the money-making effect, the off-market wait-and-see capital groups will be attracted to some extent.

In other words...as long as the Shanghai Composite Index can continue to stabilize above 3000 points.

As long as this wave of trend breaks through, it will be substantially effective.

Then, the group of funds waiting on the sidelines will eventually enter the market.

What's more, the current offline property market and the bullish enthusiasm of the entire real estate market have not only not subsided, but are becoming more and more intense.

As long as offline housing prices continue to rise and the future expectations of the vast majority of people continue to increase.

Then, our heavily invested core area of ​​'big infrastructure', a number of industry-leading stocks, and core blue-chip growth stocks in the industrial chain, will not experience a sharp correction at this point in time or during this period.

After all, the strong underlying logic is supported by expectations of strong performance explosion in the future.

The current valuations of these stocks are still relatively undervalued, and everyone can see and understand this relative undervaluation.

So, in the last month or so.

As the 'big infrastructure' line continues to rise, once there is a clear correction trend, the potential force to continue buying will be so strong.

Look at stocks like Oriental Yuhong, Conch Cement, China Construction, and Poly Real Estate.

Basically, all the way up and all the pullbacks are good buying points.

There are basically no problems with our fund's current holdings. In the market, every trading investor has his or her own trading model and trading logic.

It is impossible for us to seize every opportunity in the market.

As long as the performance of individual stocks we hold is within our expectations, and the expectations and underlying logic of the stocks we hold have not changed.

Then you should just hold on to it and let the profits continue to run.

You can't hold on to your chips when you lose money, and then lose them when you make money.

From the perspective of underlying logic and expectations, the speculation in small and medium-cap and micro-cap stocks is just a short-term speculation after the overall market investment sentiment has increased. Its sustainability and height space cannot be compared with the main line of "big infrastructure" and the main line of weight.

Moreover, in the direction of small, medium and micro-cap stocks.

Due to the large number of targets, hot money basically speculates on one stock today and another stock tomorrow, often moving to another place after taking a shot.

Market trends and target selection are extremely difficult to grasp.

Moreover, in terms of the certainty of the trend, the line of small and medium-sized stocks and micro-cap stocks cannot be compared with the main line of "big infrastructure" and the main line of weight. "

"Mr. Lu means... that we should keep our positions static?" Yu Xiaolu thought for a moment and asked, "Let the market follow its current trend?"

Lu Xiangxiang nodded and said, "As for trading strategies, as long as the overall market trend is fine, the overall market investment sentiment and investment confidence remain positive, and the trend of our heavily held stocks does not change significantly, then we will naturally focus on holding stocks. Do you want to split your positions and chase the current market hot spots? That's what hot money and retail investors should do, we can't do that."

"I don't have such thoughts." Yu Xiaolu smiled and said, "I just think that if there is no major change in market liquidity, the main line of the 'emerging industrial chain' in the direction of small and medium-sized and micro-cap stocks will continue to siphon active liquidity from the market, which will inevitably lead to the loss of blood in the main line of 'big infrastructure', and thus may fall into a correction trend, causing our positions to have a large profit retracement. However... since Mr. Lu thinks that static positions are better than dynamic increases and decreases, then let's hold them statically." "To invest, you have to learn to wait." Lu Xiangxiang smiled and continued, "Necessary retracements are inevitable. Sometimes... …If you worry too much about the retracement, you will miss out on profits, because the short-term market trend is unpredictable. We cannot accurately judge the short-term rise and fall of the market and accurately buy high and sell low. Therefore, if you try to avoid this profit retracement space, it is better to hold the chips and let the market fluctuate freely. Anyway, our fund holdings currently have a certain chip cost advantage, and with the chip cost advantage, you have the market initiative. If you blindly avoid profit retracement by increasing or decreasing positions, you may often lose chips, or just increase positions at the real high before the trend reverses. ”

"Yeah." Yu Xiaolu nodded, thinking that what Lu Xiangxiang said made sense. "Then let's keep our positions static for now and see how the market will develop next."

After saying that, she turned her attention back to the trading market between the two cities.

During the time when the two were discussing, the market trading time had already entered around 9:45.

And as the trading time lasted for more than ten minutes.

In the two markets, the industry sector indices such as real estate, building decoration, building materials, nonferrous metals, steel, coal, petrochemicals, medicine, liquor, white goods, electricity, finance, etc., which are related to the weighted main line and the "big infrastructure" main line, still maintain the pattern of shrinking sideways fluctuations.

Instead, it tends to focus on the main line of the "emerging industrial chain" in the small, medium and micro-cap sectors.

That is, the main field of "big technology", Internet software, Internet applications, electronic information, semiconductors, consumer electronics, network communications... and other industry sectors, as well as their related concept-themed stocks, are still continuing to rise, continuing to attract many active short-term speculative funds in the market, as well as retail investors following the trend and going long.

At the same time, as the market hype continues to shift towards small and medium-sized and micro-cap stocks.

At this moment, on all major stock investment exchange platforms across the Internet, countless retail investor groups are becoming more excited, and the hype sentiment in the entire market is becoming more and more intense.

"Wow, wow, this is amazing. The 'Shobeide' check has risen directly from the 4-point drop at the opening to the daily limit. Sigh... I just saw this check soaring like a skyrocket, but I didn't dare to buy it. What a pity, I have to watch this check rise to the daily limit!"

"The 'Xinwei Communication' check has also risen, from the opening flat position, it has risen to about 7 points. It feels like it will hit the daily limit. The 'Consumer Electronics' sector seems to be rising again after being quiet for a few days. The index of the entire concept sector has risen by more than 2.5%."

"Why didn't my 'Lixun Precision' stock go up? Doesn't this stock belong to the 'Consumer Electronics' sector?"

"Is it because the market is too big? The stocks that exploded during today's trading session are basically small-cap stocks."

"Yes, hurry up and buy small and micro-cap stocks with a market value of less than 50 billion. It feels like the funds that missed out today are indiscriminately attacking oversold small and micro-cap stocks."

"Small and micro-cap stocks have lagged behind the overall market in terms of growth, so they should be able to catch up."

"Right, haha... isn't this the time to make up for the loss?"

"The Changying Precision stock is really strong. It has reached its daily limit without me noticing. Alas... I sold it at a loss a few days ago. If I had known earlier, I should have held on to it for a few more days. What a pity."

"Why is 'Consumer Electronics' so popular today?"

"In September, Apple's new phone will be launched. Will investors speculate on the expected market in advance?"

"The trend of 'consumer electronics' is really good. I feel that this branch line has great potential."

"I feel that holding 'consumer electronics' stocks is better and more reassuring than holding stocks in the 'film and television media', 'internet software', and 'internet applications' sectors."

"Yes, the logic behind these stocks, such as Baofeng Technology, LeTV, and Huayi Brothers, is still a little off."

"Eh... 'Hua Yi Brothers' is rising sharply. What's the logic behind this?"

"I don't know, but the 'Film and Television Media' sector is pretty strong today, right? It feels like it's due to the 'Chinese Online' check."

"The opening of 'Huawen Online' today with a daily limit and reduced volume is really amazing, and it has boosted the performance of many stocks!"

"That's right. The check for 'Chinese Online' is now number one on the popularity list."

"It is the absolute core leader of the market today. How can it not be number one in the popularity list? I feel that the check of 'Huawen Online' will most likely open at the daily limit tomorrow."

"Indeed, the check from 'Chinese Online' has driven so many stocks today, so it should have a premium tomorrow."

"It's a pity that the ticket is not available in the morning."

"The buy order I placed at 9:23 a.m. has not yet been executed. I wonder if there will be a chance for it to be executed before the market closes today."

“Another wave of yesterday’s late-day crash and retracement? I don’t think it will happen.”

"I also think that if the 'Chinese Online' check opens with a large volume today, it will definitely be a sign of weakness."

"The hype for small and medium-sized stocks is so strong today that they will definitely not crash."

"Yes, all the previously oversold main-line sectors have exploded today."

"Yes, the Shanghai Composite Index did not move that much today, but if you look at the ChiNext Index, the increase has approached 1.5%. The difference between the two has widened to more than 1.2%."

"That's how it should be. Big tickets set the stage, and small tickets perform. Only then will a stronger money-making effect be generated."

"Yes, this market situation is still good. Previously, when the index rose sharply, individual stocks did not move much. It was basically a lonely rise."

"If the ChiNext Index can close with a big increase today, the K-line pattern will look good."

"It should close with a big rise. Today's market short-selling force is not strong. Even in the main line of major infrastructure and the main line of heavyweight sectors, there is no capital to crash the market."

"It's just that the volume is still a bit of a problem, and the entire market still hasn't expanded."

"What do you know? During the rise, the volume should remain stable. It is a good thing if there is no increase in volume. Once the volume increases significantly, it means that the market has risen to a certain level."

"Haha, some people say that increasing volume is good, while others say that increasing volume is bad. In my opinion, as long as the market can rise, no matter how the volume changes, it is good."

With the heated discussions among the large number of retail investors in the market and the gradually high investment sentiment.

The market trends of the two markets began to gradually stabilize after 10 a.m., with the Shanghai Composite Index fluctuating sideways at a gain of 0.3% to 0.5%. The ChiNext Index, which represents the main line of the "emerging industrial chain" and the trend of small and medium-sized stocks, also began to face selling pressure from profit-taking after a sharp rise in the morning half an hour, and gradually slowed down in the range of 1.4% to 1.6%. (End of this chapter)