Rebirth of the Capital Legend

“No matter what happens, the market will provide the answer,” Zhang Xinlei said at this time. “Let’s see how the sentiment changes tonight and how the overseas markets perform. If the sentiment feedback remains positive, and at the same time, the US stock market continues to open higher and move higher, continuing the bull market, then I still think we can be optimistic about the future market.”

He Zhong paused for a moment and then said, "Since in the most pessimistic scenario, the Shanghai Composite Index will likely fall to around 3000 points, it is perfectly acceptable to maintain a certain degree of aggressive trading strategy. After all, there is only a maximum adjustment range of 3 points at the 3000-point level."

Within this narrow range of fluctuation, it is perfectly acceptable to engage in speculation based on the core leading stocks in the market.

In summary, from a medium- to long-term perspective...

Although market volume has not yet returned to normal levels, it has already passed the most difficult period of the previous prolonged decline.

If you were able to do it during the previous stock market crash, there's no reason to be timid now, right?
Furthermore, so far this year, no truly remarkable stocks have achieved consecutive limit-up days.

Given the current timing and market sentiment, the stock of Beijiang Jiaojian has reached this point, and there's no reason not to continue the speculation.

Anyway, I didn't sell a single share of this stock today; I'm continuing to hold it.

I need to see how high this stock can go.

“Old He is right, there’s no reason to back down now.” Zhang Xinlei responded and continued, “Even if the market continues to adjust, even if the Shanghai Composite Index has to retrace to 3000 points to confirm support, there will still be a local profit-making effect in the market during this retracement. Within this local profit-making effect, betting on the leading stocks in the core themes of the market should be the most cost-effective trading strategy at present.”

Amidst the heated discussion among the major speculative investors in the 'Suzhou system' internal group.

On all major online stock investment discussion platforms.

The debate among numerous retail investors, debating whether to buy or sell, remains intense.

As time went on, the US stock market opened for trading in the evening, and everyone saw that the US stock market continued to rise and hit new historical highs.

The market sentiment, which was previously divided between bulls and bears, has once again begun to shift towards the bulls.

Then, after a night of emotional buildup.

The next day, Friday, September 9th, arrived. Before the market even opened, the overall sentiment in the morning session had already returned to a generally bullish one.

"With so many positive factors last night, coupled with the continued record highs in overseas markets, the A-shares market should open higher today to recover from yesterday's plunge, right? Perhaps the Shanghai Composite Index will once again challenge 3100 points today."

Amid the generally bullish market sentiment in the morning session, many retail investors gathered on various online stock investment exchange platforms expressed the following sentiment.

"I also feel that the market will recover from yesterday's trend today, after all, there are no negative factors on the surface."

"The US stock market is freaking out, it just keeps going up without any pullback. How many years has this bull market been going on?"

"To be precise, the US stock market bull run has lasted for more than a decade, and there is currently no sign of it ending."

"The US stock market naturally attracts active funds from around the world, with a constant influx of off-exchange capital. As long as the valuations aren't too outrageous, it seems unlikely to crash. Moreover, the US stock market is much more mature than the domestic market, with most market participants being institutional investors and relatively few retail investors. Naturally, the trend is much more stable because most of the participating funds are long-term funds."

"I don't know if you've noticed, but in the US stock market, only a few tech giants have experienced long-term bull runs. The index's performance is entirely supported by heavyweight stocks and tech leaders. Other small and mid-cap stocks have fallen quite a bit."

"What I mean is that the A-shares market is currently learning from the US stock market."

"It can be said that, at least the major institutional funds in our market are indeed following suit."

"So, does that mean the market will continue to follow the trend of heavyweight stocks and the market driven by heavyweight and industry leaders?"

"It is highly likely that small and mid-cap stocks and micro-cap stocks in the current market are indeed the areas with the most severe losses in the market."

"Damn it, most of my holdings are in small and mid-cap stocks, and I also have a lot of tech stocks. What am I going to do?"

"Holding a lot of tech stocks? You must be down quite a bit, right?"

"I'm down 40% with my entire portfolio. I've been wanting to cut my losses for so long these past few days, but alas... I just can't bring myself to do it."

"It's already down 40%, is there any need to sell now? I feel that the tech sector has fallen pretty much to its limit at this point."

"There's no bottom to a downtrend; it's really hard to say when it's reached its limit."

"I don't understand. The main theme of the US stock market has always been technology and the internet. Why is the technology sector in China performing so poorly?"

"There's nothing hard to understand about this. Both are technology stocks, but what about the valuations and quality of those leading tech stocks in the US market? And what about the valuations and quality of the so-called leading tech stocks in our A-shares market? If we're talking about valuations, even if the leading tech stocks in the US market have risen to their current levels, their valuations are still relatively low, and far lower than the valuations of the many leading tech stocks in our A-shares market that have already fallen by 70%."

"That's true. In the US stock market, Apple's current price-to-earnings ratio is only 20."

"That's it. Among domestic tech stocks, very few have a valuation of 20 times earnings, right? Most of them have fallen by 70%, yet their valuations are still generally above 50 times earnings. With such valuations and unlikely optimistic performance, how can the stock price possibly rebound significantly?"

"But from a long-term perspective, technology is indeed the future."

"Well, what's that saying again? Technology is the primary productive force. Anyway, I think the market's constant hype about infrastructure and consumption has no future."

Whether it has a future or not is not up to us to decide.

"That's right. The main theme the market follows is determined by the major funds in the market."

"When it comes to stock trading, I think it's best not to focus too much on macro-level narratives. Just buy whatever stocks are performing well."

"That's not necessarily true. You might see it rising well, but as soon as you buy in, it could start to fall immediately."

"That's right, the price drops as soon as I buy and rises as soon as I sell. It never fails. It's really weird. I feel like I'm just not suited for stock trading."

"The safest way is actually to pick a stock, buy it, and hold it without moving it. Otherwise... it will be very difficult to make money in the end."

"I can't stay still. When I see a big rise or a big fall, I just can't help myself."

"Unless you uninstall the software and stop looking at it."

"No way. What if the stock you bought is delisted after you uninstall the software? You'll have nowhere to cry then. It's okay to keep an eye on the market, just don't buy and sell too frequently. In today's market, short-term trading isn't as easy as it used to be."

"Short-term trading is indeed quite difficult."

"The market's profit-making effect is still too poor. During last year's bull market, I made up to 10 times the profit in just a few months by doing short-term trading. Unfortunately... the subsequent stock market crashes gave it all back to the market."

"That's it, the profits can't be taken away at all."

"Unless you stop investing in stocks after you've made money, you'll eventually have to give it all back to the market."

"I wonder how those amazing speculative investors manage to make thousands or even tens of thousands of times their initial investment in just a few years?"

"That's what you call talent. People with this kind of talent are one in ten thousand. And as the amount of capital increases, the rate of return will definitely decrease."

"Those who turn tens of thousands of dollars into hundreds of millions in a few years are truly amazing." "Just listen to that, I don't really believe it."

"A trader with Mr. Su's genius-level skills must really be real, right?"

"This is definitely true, but it's the only case in the entire market. So... don't fantasize about becoming someone like President Su. In the financial trading market, whether it's a bull market or a bear market, I firmly believe in the ironclad rule of seven losses, two breaks even, and one profit. It's absolutely true."

"A bull market should be relatively easier to achieve, right?"

"When there is a general rise in prices, most market participants will definitely make money. It's just that the profits made during a general rise are hard to actually take away."

"That's right, anyway, I've been losing money since I started investing in stocks."

"Haha, same here, I'm still down 20."

"I'm still down 200 million, sigh... I don't know when I'll be able to break even."

"I'll wait until the next bull market comes. Anyway, once I break even, I really won't trade stocks anymore. Damn it... it's a waste of time and it affects my mood."

"Yes, I feel really bad every time I lose money."

"This is very normal. It's so difficult to remain unaffected by external gains or losses. It's hard to be completely unaffected by emotions."

"I think I've figured it out now. Our A-shares market is actually just a purely sentiment-driven market. The fluctuations in bullish and bearish sentiment are too great, and there are too many retail investors following the trend and speculating."

"Is there anything strange about that? Short-term trading is all about making money from the price difference in stock prices."

"Don't those who call themselves value investors also profit from stock price differences? What's the difference?"

"People will say that what they value is the dividends."

"Speaking of dividends, shouldn't there be an ex-rights adjustment? And taxes should be deducted, which is like giving yourself your own money. Isn't that pointless?"

"That's still different. After dividends are paid, some stocks will recover their value."

"There aren't many stocks that have filled the gap after ex-dividend, are there?"

"If you buy and hold onto the core leading stocks and collect dividends, it's actually quite worthwhile. If the performance increases, the dividends will also increase."

"This is actually a false proposition. If performance increases, dividends will increase. But what if performance decreases? Won't dividends also decrease? Performance is something that cannot be quantified. It can only be guessed or predicted based on the fundamentals of the industry. If the performance prediction is wrong, then the stock price will fall and dividends will decrease. Naturally, buying these core heavyweight leading stocks is no different from buying those small and medium-sized concept stocks."

"That's one way to put it. Some heavyweight stocks do indeed have steady growth in performance every year, like bank stocks, right? Aren't the performances and dividends of the Big Four banks unstable every year? It's just that many people look down on the daily fluctuations of one or two cents in these stocks."

"Anyway, this kind of trading is not suitable for me. I would go crazy if I watched these stocks fluctuate by a penny or two."

"I wouldn't buy these stocks just to collect dividends. Why bother with the stock market? Wouldn't it be safer to buy bank wealth management products? People come here to get rich quick."

"I've never become rich overnight, but I've certainly become extremely indebted."

"That's right, heavily in debt."

"Short-term trading has its own methods, and long-term trading has its own approaches. I don't think the two are contradictory; it just depends on which one suits you better. However, buying heavyweight leading stocks to collect dividends does require a lot of patience. After all, holding these kinds of stocks for a period of time after buying them doesn't really make much sense."

"Only large funds can play this game. It's meaningless for small funds to just collect dividends. A few hundred or a few thousand dollars a year is not as good as working a little harder."

"Haha, that's not wrong either."

"It's a pity that even short-term speculation is difficult to make money."

"Learn to trade on the breakout day. I feel that in the current market, among short-term trading methods, only the breakout day strategy is relatively reliable. The others... are not very good."

"Now even the limit-up strategy doesn't work anymore. You usually can't get into the first limit-up, and the second limit-up lacks sustainability."

"Then buy the leading stocks, chase the leading stocks of popular market concepts."

"Even leading stocks aren't easy to chase. Take Shuguang Shares for example. If you chased it at the daily limit up, you could lose about 15% in one day. How long will it take to recover that loss!"

"Is Shuguang Shares considered a leading stock? This stock doesn't seem to have much market presence, does it?"

"Before this stock hit its daily limit down yesterday, wasn't it the leading stock in the new energy industry chain? The stock with the highest consecutive daily limit up."

"The leading stock in the new energy industry chain that has seen consecutive limit-up days must be Tinci Materials."

"That's right. What kind of leading stock is it if it hits the daily limit with a single-word limit up and low volume? Stocks with no turnover and a completely broken shareholding structure have no market position at all, and you shouldn't buy them at high prices. To be honest, those who bought this stock today... simply don't understand the essence of short-term speculation."

"What is the essence of short-term speculation?"

"It's hard to say. Everyone has their own understanding. In my understanding, it's about two things: intraday expectations and exceeding expectations."

"That's right. Given the opening situation of Shuguang Shares yesterday morning, we really shouldn't have chased it."

"Anyway, I won't buy any stock that hits its limit up price with no volume on the first day of a limit up. Even if I were to buy, I would wait and see how the market reacts the next day."

"Sigh, I suffered a loss from chasing consecutive limit-up stocks. Yesterday's Shuguang Shares, and before that, Quantong Education and Huawen Online, I basically bought at the highest point and didn't have time to stop the loss and sell. In just a few trading days, they fell back to their original point. In the end, I cut my losses and suffered a loss of more than 20%. These two stocks wiped out 40% of my principal. Now, I really don't dare to chase these consecutive limit-up stocks."

"Some stocks that hit the daily limit for several consecutive days can be chased, while others cannot. There is indeed a lot to learn about this."

"Stocks that hit consecutive daily price limits can indeed make a lot of money if you buy the right one, but you can also lose a lot of money instantly if you buy the wrong one. This kind of high-volatility trading style is really not suitable for me. I prefer stocks with smaller fluctuations or smoother trends, such as the trend of Oriental Yuhong. In fact, buying and holding it is the most comfortable, and you don't have to worry about the stock price suddenly soaring or plummeting."

“Trending stocks are certainly good, but these kinds of stocks are rare and hard to come by.”

"It's true that such opportunities are rare and hard to come by. Not only do you need to carefully research and dare to get involved at low prices, but you also need to have confidence in your judgment and not get shaken out during various volatile market movements. Take Oriental Yuhong stock as an example. During the entire trend, there were still many deep pullbacks, even limit-down pullbacks. If you keep watching the market, it will be difficult to hold onto your shares when you encounter such movements."

"So, as the saying goes, holding onto stocks is like being a widow, and I firmly believe that."

"Anyone who can hold onto a stock that has multiplied several times in value from the bottom to the top is definitely not an ordinary person."

Amidst the intense discussions among countless retail investors gathered on various online platforms, time had unknowingly reached 9:15 AM.

All eyes, both inside and outside the market, were focused on this event.

Amidst the intense scrutiny of everyone.

The stagnant market in both Shanghai and Shenzhen markets suddenly began to fluctuate wildly, and ultimately, as widely expected before the market opened, a broad-based rally occurred.

"As expected, it opened slightly higher. I knew it; the pre-market sentiment was good, and with various positive news, a higher opening was warranted." Seeing the two markets open slightly higher as expected, Zhao Zhiyuan smiled and said in the 'Shandong Gang' group of major speculative investors, "Now that the sentiment has stabilized, those stocks that were wrongly sold off yesterday afternoon are very worthwhile to enter and speculate on during today's opening auction." (End of Chapter)