Rebirth of the Capital Legend

"Indeed." Jia Yongxiang responded, "Originally, I thought the market had formed an investment style dominated by blue-chip stocks and white horse performance stocks. Now it seems that most retail investors in the market still like to speculate on small and poor stocks. It seems that our previous belief that the market investment style has changed comprehensively was an illusion."

Song Shaopu pondered for a while and said, "It shouldn't be an illusion. In the medium and long term, defensive sectors such as liquor, white goods, medicine, and consumption, as well as other mainline sectors with fundamental shifts, blue-chip weighted stocks, and white horse performance stocks are indeed much stronger than concept small tickets. Moreover, the market speculation has indeed been restrained a lot in the past six months."

"Then how do we understand the current market trend?" Jia Yongxiang asked.

Song Shaopu thought for a moment and responded, "It should be a short-term oversold rebound. From a fundamental logic analysis, there is no expectation of a reversal in the two major industry sectors of Internet software and film and television media. Even the main sector of the 'new energy industry chain', which has good long-term expectations in the future, lacks certain underlying logic support."

"Well, we can only regard it as an oversold rebound for now," Jia Yongxiang responded.

After they transferred all fund positions to the core theme of "big infrastructure", they basically had no positions in the low-level and oversold themes such as Internet software, film and television media, and new energy industry chain.

Therefore, when the main line of "big infrastructure" began to enter the adjustment stage, these oversold main line sectors rebounded rapidly.

They basically cannot make any money and have to bear a significant net worth drawdown.

However, since the positions have been transferred to the core theme of "big infrastructure", and the sustainability of the oversold main line trends such as the booming Internet software, film and television media, and new energy industry chain remains in doubt, these oversold main lines also lack the support of underlying logic.

Therefore, even though they will suffer a significant net value drawdown during the comprehensive adjustment of the main line of "big infrastructure".

They will not make rash adjustments to their portfolios at this point in time.

In fact, today's market conditions and many active capital groups in the market have clearly shifted from the "big infrastructure" main line to the Internet software, film and television media, new energy industry chain... these low-level oversold main lines, but not many institutional funds have followed up.

It is mainly hot money and retail investors who are gathering to speculate.

"Haha, the market has been falling for two weeks in a row, and today I finally made some money."

Just as the stocks held by major institutions in the market were retreating one after another and they were complaining that the market had started to speculate on concepts again, after the market closed, the vast majority of retail investors who gathered in the online stock investment exchange forum were indeed quite surprised and expressed their feelings happily.

After all, at today's close, the Shanghai Composite Index, A50 Index and Shenzhen Composite Index performed weakly.

However, in the entire market, most stocks still closed in the green, and the main intraday loss effect was concentrated on stocks related to the "big infrastructure" main line, as well as medicine, liquor, consumption, white appliances, banks, insurance... and other low-risk defensive sectors that are held by institutions.

"Same, the market went up before, it really had nothing to do with me. Today the market stopped going up, I didn't expect that I would make money instead."

"It's strange to say that when the core theme of 'big infrastructure' continued to rise, in the market, in addition to the popular concept stocks in the field of 'big infrastructure', there were also a number of blue-chip stocks and high-performance white horse stocks that were held by institutions. Other main concept stocks and a number of small-cap stocks either remained unchanged and fluctuated sideways with shrinking volume, or went down against the trend and hit new lows. Now that the 'big infrastructure' theme has risen and fallen, it has fallen into an obvious adjustment trend. Unexpectedly, other small and medium-cap stocks in the market that were not held by institutions have come alive and attracted the attention of a lot of funds. The buying on the market is also obviously much more than before."

"When a whale falls, everything comes to life. With limited market liquidity, the main line of 'big infrastructure' has siphoned off too much liquidity from other main line sectors in the market. Without active buying support from other main line sectors, stock prices naturally cannot rise."

"Does this mean that if the 'big infrastructure' line doesn't increase, it will actually be beneficial to everyone?"

"That's not the case. Without the core theme of 'big infrastructure' to generate sustained profit and drive the overall bullish sentiment in the market, there would be no active buying from the off-market. In that case... market liquidity would become increasingly scarce. Except for some core weighted stocks that are held by institutions, other stocks in the entire market would show a trend of continuous decline and their valuations would be continuously compressed."

"So, is it better for the 'big infrastructure' line to rise or fall?"

"It will definitely be better if it continues to rise after a short adjustment, so that the market valuation space can be truly opened up and more off-market funds can be truly attracted to enter."

"I've seen a lot of people say that the trend of small and medium-cap stocks and the main trend of 'big infrastructure' is a seesaw effect. If so... then the main trend of 'big infrastructure' should maintain a volatile pattern, neither rising nor falling, so that other main trends can be rotated and hyped, which should be the best situation, right?"

"Neither rising nor falling means that the long sentiment of the core main line has receded. If the long sentiment of the core main line has receded, how can the market of other main lines that are not as strong as expected be good? Although from the perspective of market capital liquidity, there is a seesaw effect between the 'big infrastructure' main line and the small and medium-sized concept stocks of other main lines in the market, which is a special competitive relationship, but the two are also a mutually reinforcing relationship. Personally, I think... Only when the core main line of 'big infrastructure' strongly creates a high space for speculation, and the core weighted stocks have a magnificent and continuous upward trend, will the valuation level of the entire market be raised, and the investment risk preference of the entire market will be improved. Only when the valuation level and investment risk preference of the entire market are greatly improved, the market will have higher liquidity, and the small and medium-sized concept stocks of other main lines will also usher in more and higher speculation opportunities. Naturally, we can all make money, or successfully get out of the predicament."

"Can't the main sectors such as Internet software, new energy industry chain, film and television media... independently strengthen?"

"Independent strength always needs to be supported by expectations, right? What are the expectations for these major sectors?"

“Isn’t ‘new energy vehicles’ an inevitable trend of development in the future?”

"It is an inevitable trend, but when will this trend be reflected in performance and fulfilled? Five years? Ten years? Trend expectations that are too far away will have a diminishing marginal effect on the stock price. Let's take a look at the 'big infrastructure' line... Why has this core line been so strong in the past two weeks? Isn't it because the real estate market across the country has completely exploded? Aren't there strong favorable policies that have been promoting it? What's more, the 'big infrastructure' line, including construction decoration, building materials, nonferrous metals, steel, coal and other sectors, basically lack the hype of the previous round of bull market, which means that its valuation is already at a historical low. At the bottom, the expectation gap is very large, so various funds are gathering to buy. On the other hand, the core stocks of the main sectors such as Internet software, new energy industry chain, film and television media... have fallen a lot after the hype of the last round of bull market. In fact, judging from the valuation and future expectations, they are still very expensive. It’s just that too many chips were locked up in the early stage, and now it is obvious that some are oversold at the technical level. It just so happens that the main line of "big infrastructure" has encountered upward resistance and entered an adjustment, releasing liquidity, so it has attracted a lot of funds to speculate. But I believe that this oversold rebound market is unlikely to last far, so everyone should stop when they see good results. "

"I don't quite agree with this. The major sectors in the main field of 'big infrastructure' are basically traditional industries, while Internet software and film and television media will definitely continue to shine in the era of 'mobile Internet', and the 'new energy industry chain' is indeed a major trend in the future. In terms of long-term expectations, how can these sunset industries such as 'real estate', 'steel', 'coal', 'building decoration', and 'building materials' be compared with these emerging industries? I think this round of 'big infrastructure' main line market, as well as the previous liquor, white appliances, pharmaceuticals, and consumer main line markets, are purely forced together by the major main institutions in the market. The purpose of the institutions is mainly to attract everyone to gather around the stocks in these main fields, to carry their sedan chairs, and to take over their positions."

“It’s true that institutions are holding blue-chip and white horse stocks, but the rise in the share prices of these blue-chip and white horse stocks is essentially driven by the explosion of performance. Without the explosion of performance as the fundamental driving force, can the financial advantages of institutions alone drive up the share prices?”

"Why not? Many stocks are simply bought up by institutions using their financial strength."

"Anyway, I won't be a supporter or a takeover agent for an institution."

"Indeed, recently many institutions have been promoting the concept of 'value investing'. This thing... in our A-share market, if you ask me, it is not suitable for local conditions. Anyone who believes in it is a fool."

"Compared with many stocks in the main line of 'big infrastructure', Internet software, film and television media, new energy industry chain and other main line sectors that are obviously oversold, many stocks do have the need to catch up, right?"

"To see whether a stock is cheap simply by looking at how much it has fallen, I think we still have to look at its valuation."

"Looking at valuations to trade stocks in the A-share market? Haha... isn't this a huge joke? Just look at whether the market makers in the stock market are pulling the stocks and that's it. Why do you still need valuations?"

"The dealer, that's ancient times, right? Now it's all market forces."

"Anyway, the main line of 'Big Infrastructure' is in the process of adjustment, and it is certain that people will be buried tomorrow. At this time, whoever is willing to catch the flying knife can go. Anyway, I won't go."

“Indeed, low-priced stocks are more cost-effective.”

"I think the logic of 'the strong will always be strong' will not change. The 'big infrastructure' line has such a strong trend. This will definitely not be the place where the main trend ends."

"Won't we know after we check the Dragon and Tiger List data? Let's see if there is a list of sales by Mr. Su from Huayi Capital."

"'Fuxing Road'? I don't think 'Fuxing Road' will be sold at this time."

"It's hard to say. Although Huayi Capital, which is headed by President Su, is a well-established institutional powerhouse, their organization has indeed made a lot of money in this wave of market conditions."

"I don't know whether Fuxing Road was sold or not, but today, hot money like Fushan Group, Gusu Group, Yuhang Group, Qilu Gang, etc. must have sold stocks on a large scale. Damn... core leaders like Beijiang Communications Construction and Capital Group were able to hit the limit down. How shameless."

"That's right. Compared with institutions, these hot money are even more brutal in harvesting."

"Hot money is not as well-organized as institutions."

"In the current market situation, institutionally-led stocks are indeed more stable and less prone to sudden rises and falls."

"I don't want to give institutions a push, but it is a fact that the market is leaning towards small-cap concept stocks today. It depends on whether it lasts. If it lasts for a few days or a week, I think the market's speculation trend will be completely reversed."

Accompanied by continuous discussions among countless retail investor groups on online platforms.

It can be clearly felt.

As the market trend has changed and the main line of "big infrastructure" has been adjusted, small and medium-sized stocks that had been continuously drained by large-cap stocks and blue-chip stocks in the early stage have generally rebounded.

There are still great differences in people's judgment and expectations on the subsequent market trends.

However, amid this divergence of opinions, the market's bullish sentiment has improved and everyone is relatively consistent in their optimism about the overall market conditions.

Moreover, as time goes by.

As the online discussion became more and more heated, 5 o'clock in the afternoon soon arrived and the Dragon and Tiger Lists of the two cities were refreshed.

Everyone's attention was focused on the published Dragon and Tiger List data of the two cities.

It can be seen that, as everyone expected, the "Huayi Capital" institution headed by Su Yi, its associated "Fuxing Road" seat, and institutional seats did not appear on the selling list. This shows that at a time when the core theme of "big infrastructure" is in obvious adjustment, this core main fund that everyone has high hopes for has not reduced its position at all, nor has it shown any doubts about the subsequent market trend of the core theme of "big infrastructure".

"Huayi Capital has locked its positions, and many other major institutional funds have bought a lot of chips in the "big infrastructure" line today." After seeing the Dragon and Tiger List data disclosed by the two markets, Huang Qingyun, the trading team leader of the "Xino Future No. 1" fund product trading room of Sino Private Equity Fund Company in Shanghai, said, "At the same time, while the main institutional funds continue to increase their positions, hot money and retail funds are constantly fleeing.

There are also the main lines of the Internet software, film and television media, and new energy industry chains that have exploded today.

According to the data from the Dragon and Tiger List, the core main buyers are also hot money and retail investors. There is basically no institutional main force participating in increasing holdings in these major oversold rebounds.

Mr. Men, these buying and selling data should be able to fully explain that the internal chip structure of the main line of "big infrastructure" is still further concentrated. At the same time, it can also explain that the market conditions in the Internet software, film and television media, new energy industry chain... these oversold main lines are not sustainable, right?"