Source: Brokerage China Author: Qu Hongyan Recently, China Yangtze Power hit a historical high and once again showed the slow bull stock trend of "tripling in ten years". The slow bull market has left behind many passers-by and brought good returns to the steadfast investors. It is "rare for those who triple in one year to be like carp jumping over the dragon gate, while those who double in three years are few and far between." On the other end of the investment world, however, violent collapses are also deafening, with many financial products suspected of "Ponzi schemes" ceasing payments, leaving investors with no hope of recovering their investments. Both positive and negative cases illustrate the importance of forming a suitable mentality towards money in one's lifetime; otherwise, sooner or later, you will divorce yourself from your money. "I call this the money mind, a person's IQ can reach 120, 140, or even higher levels, and perhaps some people's minds are good at doing one thing, while others are good at doing another. They can do things that most ordinary people can't do. But I know some very smart people who make very foolish decisions because they lack the money mind." Buffett once said so. The so-called money mind refers to believing in common sense, believing in compound interest, being cautious and rational, thinking independently, prioritizing security over return, not dealing with people with questionable character, not easily guaranteeing for others, not believing in windfall profits, and not trying to cross legal norms for extra benefits. In today's world of ubiquitous information, everyone's wealth may become the "prey" of those with ulterior motives. Only with the money mind, can one form good behavior habits and shield oneself from separating from one's wealth. Do not entrust your wealth easily. Wealth is easy to lose but hard to accumulate, and trust is a vital reason leading to the rapid loss of wealth. "Do not allow anyone else to manage your business unless you can watch their every move closely and understand their behavior; or you have strong reasons to believe in their character and ability. For investors, this criterion determines when you can let someone else make investment decisions for you." Graham's criterion written eighty years ago is so clear. Almost all the investors who lost their wealth in the financial products have violated the above two criteria. They did not have the ability to closely supervise the whereabouts of their funds, nor did they have sufficient reasons to believe in the character of the product issuers. They easily invested their own wealth solely based on others' glib tongue and a piece of commitment paper. They did not act as gatekeepers of their own wealth and ended up with nothing left even if the government punished the wrongdoers. "An ounce of prevention is worth a pound of cure." This is a phrase Munger often says. Destiny must be in one's own hands, and investors with a suitable money mind will try their best to find suspicious points in their investments to protect the safety of their principal. For example, whether the manager is trustworthy, whether the underlying assets are profitable, whether oneself can timely monitor the risks in the investment process, and whether the sales staff is obtaining large commissions. As long as any unreliable signs are found, these investors firmly will not invest their money. Do not desire to get rich quick. As in the capital market and anywhere else, making money is not easy, and desiring to get rich quick will lead to quick loss of wealth. In the capital market, the desire to get rich quickly often leads to investors over-allocating specific stocks, industries, or assets at the worst time. For example, buying high-risk stocks that can gain huge returns once an adventure succeeds, but the chance of success is very small, also known as "whispering stocks" by legendary fund manager Peter Lynch. "They often tell investors a story with explosive effects. These 'whispering stocks' have a hypnotic effect on people, and it is easy for you to believe that the story the company tells has an emotional appeal that can easily confuse you." This is like hearing a very tempting "sizzling" sound, making you salivate, but you did not notice that there is no steak on the grill. In the eyes of investors who lack the money mind, stable yield provided by blue chips such as China Yangtze Power cannot meet their demands. However, historical experience clearly shows that buying stocks lacking in safety solely based on imagined high yields is unwise. The long-term average investment return of general stocks is 9%-10%, which is also the average investment return of stock indexes in history, a benchmark to measure one's investment performance and the benchmark to measure fund investment performance.
Author: Shi Qian. Will this be the arrival of the "real wolf"? The consumption tax rumors suddenly spread in various investment groups yesterday after the close of trading. There are reports that a trillion-level consumption tax reform will be approaching, and luxury goods and high-end services may be the first to test. As of the close of trading this morning, consumer stocks suddenly rebounded collectively, and retail and duty-free areas led the rise. Among them,

In the afternoon today, A-shares and Hong Kong stocks staged a strong rally together. The ChiNext Price Index rose over 11%, the SSE Science and Technology Innovation Board 50 Index rose over 14%, the SSE Composite Index rose over 4%, and the Shenzhen Component Index rose over 7%. The Hang Seng Tech Index rose by about 7%, and the Hang Seng Index rose over 4%. A50 surged nearly 6%. U.S. stocks overnight saw Chinese assets strengthen again, with 3 times long FTSE China ETF rising over 17%, 2 times long CSI 300 ETF rising over 14%; Bilibili rose over 10%, XPeng rose nearly 9%, KE Holdings rose over 8%, NIO Inc rose over 7%, PDD Holdings and JD.com rose over 6%, Alibaba rose over 5%.

Analysts believe that while the morning statements from the central bank and the securities regulator are important, the key to the market regaining confidence lies in the high-level expressions about technology at noon. Sinolink Securities' Zhang Chi believes that the 'market bottom' has appeared and solidified, with the potential for the 'profit bottom' to become a key factor for the market trend to continue and reverse in the future; in terms of funds, the key lies in the willingness of actively managed funds to inflow. Structurally, it is a technology bull market.

The sentiment has returned.

In the morning today, the market saw some back and forth, but bullish sentiment surged in the afternoon. A-shares and Hong Kong stocks strengthened across the board, and overseas Chinese assets also surged together.

As of now, $Chinext Price Index (399006.SZ)$ $SSE Science and Technology Innovation Board 50 Index (000688.SH)$ Rising more than 14%. $SSE Composite Index (000001.SH)$ Up more than 4%. $Shenzhen Component Index (399001.SZ)$ Risen by more than 7%. $Hang Seng TECH Index (800700.HK)$ Rose by about 7%, $Hang Seng Index (800000.HK)$ Rose by over 4%. $FTSE China A50 Index Futures(OCT4) (CNmain.SG)$ Surged nearly 6%.

U.S. stocks night session, Chinese assets also strengthened once again, $Direxion Daily FTSE China Bull 3X Shares ETF (YINN.US)$ Rising more than 17%. $Direxion Daily CSI 300 China A Share Bull 2X Shares (CHAU.US)$ Rose more than 14%. $Bilibili (BILI.US)$ Up more than 10%, $XPeng (XPEV.US)$ Rise nearly 9%, $KE Holdings (BEKE.US)$ rose more than 8%, $NIO Inc (NIO.US)$ Rise more than 7%, $PDD Holdings (PDD.US)$Please use your Futubull account to access the feature.$JD.com (JD.US)$ Up more than 6%, $Alibaba (BABA.US)$ Rose more than 5%.

From the market perspective, the biggest variable in the afternoon today comes from senior officials' statements about "promoting Chinese modernization, with technology leading the way. Technological innovation is the only way." At the same time, the statements made by the People's Bank of China and the China Securities Regulatory Commission in the morning are also bullish for the market. In the afternoon, there were continuous reports that leading funds and brokerage firms such as E Fund Management, Huaxia Fund, China International Capital Corporation, CITIC Securities, and a brokerage firm from South China have been approved to participate in convenient interbank operations. Among them, CITIC Securities has an applied quota of around 10 billion yuan. Currently, 20 securities and fund companies have been approved to participate in these operations, with a total applied quota exceeding 200 billion yuan.

At the same time, the People's Bank of China allows eligible listed companies and major shareholders to apply for loans from 21 national financial institutions including the China Development Bank, various policy banks, state-owned commercial banks, China Postal Savings Bank, and various joint-stock commercial banks. Financial institutions, based on market principles, independently grant loans to eligible listed companies and major shareholders, specifically for the purpose of share buybacks and increasing shareholdings of listed companies through loans. If the share buyback and increase lending provided by the 21 financial institutions do not comply with related regulatory provisions such as 'credit funds must not flow into the stock market,' they are exempt from complying with those regulations.

Is it the time for a technology bull market or a comprehensive bull market?

Zheng Chi from Sinolink Securities believes this morning that one should cherish the opportunity to get on board again, the structure is "technology bull". Today, the Star Market had another outbreak, and the Star Market ETF surged. Zheng Chi believes that with overseas risks abating, there are limited constraints on domestic assets; domestically, both 'loose monetary + loose fiscal policies' are exerting efforts from the liability side, and are expected to restore the cash flow and balance sheets of local governments, enterprises, and residents, thereby driving marginal improvements in domestic demand. It is expected that macroeconomic data, medium-term economic sentiment, and micro-profit data in the fourth quarter are all expected to marginally improve, supporting further market gains.

Zheng Chi stated that behind the rebound are the expectations of credit recovery and valuation expansion. When selecting industries and individual stocks, one should pay attention to: 'denominator elasticity', being bullish on middle-cap + oversold + undervalued + share buyback + merger expectations, with relatively weak 'numerator constraints' (such as ROE improvement or cash flow enhancement) favoring 'growth> consumer'. 1. Prefer growth: TMT, especially electronics, computers; 2. Defense military industry; 3. Healthcare and biotech. 2. Secondary choice consumer: 1. Baijiu; 2. Social services; 3. Light industry; 4. Medical aesthetics. Structurally, emphasize 'technology bull!', especially focusing on technology-related equipment, which is one of the directions for fiscal policy investment; numerous thematic catalysts; and "Zhu Gelra" cyclic income varieties.

He determines that the 'market bottom' has already appeared and solidified, and the future 'earnings bottom' is likely to become a key factor for the continuation and reversal of the market trend; in terms of fund flows, the willingness of active funds is crucial.

Loose monetary policy and loose credit typically bring opportunities for growth stocks, which is the aforementioned 'technology bull'. However, fiscal efforts are also in play. The issuance of special national bonds to supplement bank capital, municipal bonds, housing property storage, among others, play a significant role in repairing the balance sheets of industries such as banks. At the same time, it is also conducive to the continued evolution of dividend assets like 'beginning with middle letter'. Currently, the market is also awaiting actions related to the scale of bond issuance in the upcoming National People's Congress session, which may once again stimulate market expectations. On the other hand, from the perspective of interest rate differentials, the 'share buyback and increase lending' is actually most favorable for dividend assets.

Editor / jayden