A-share characteristics: investment rings and spring restlessness

The "investment circle" of A-share market

First of all, let me talk about what is called "spring agitation, April decision". Every year, whether it is a bull market or a bear market, there will be a wave of market at the beginning of the year. This market is not necessarily directly related to the fundamentals at that time, but is determined by many factors. But often in April, there will be a decisive period, which will really determine the overall trend of that year. The restlessness of spring may deviate from the final direction to some extent. This situation has happened almost every year since I joined the business in 2006. I also learned from some predecessors that similar situations occurred from time to time before 2006.

Due to seasonal factors, weather, meetings and economic factors, the annual A-share investment shows a strong regularity. Let's start with the first part: What is the annual "spring sleep"?

Generally speaking, investing in a market will go through several stages:

1-March: In the restless period of spring, the investment risk preference is high, and there are more theme opportunities or other investment opportunities.

April-May: Judge whether the investment season is coming. At this time, when the real return to China and new construction begin, it is necessary to test whether many situations in the spring tide are true. For example, how about the rework tide in Guangdong after the Lantern Festival, and whether the investment peak season comes, these conditions will determine the direction of the whole second quarter.

Mid-year: Beidaihe meeting will make decisions on the economy and personnel and the overall development of the situation in the second half of the year, including economic policies, so Beidaihe meeting may have a significant impact on the trend of A shares.

9- 10: Holidays are concentrated, such as Mid-Autumn Festival and National Day holidays. When the peak season of consumer goods comes, consumer goods will usher in a wave of market rise. At this time, it is also the time to switch the valuation of some stable consumer goods at the end of the year. Therefore, if the overall economic situation is good in the first half of the year, it will be the rising period of cyclical products and the rising period of consumer goods in the second half of the year.

Year-end: there will be several important events, namely, 1) the central economic work conference will set the tone for next year's economic work, 2) the settlement of institutional funds will cause some funds shortage, and 3) the year-end performance appraisal of A-share investors (many large institutions often complete the annual performance appraisal at 1 1). In these cases, risk appetite will drop rapidly. Therefore, the wind preference at the end of each year is often much lower than that at the beginning of each year.

These characteristics can basically belong to an investment circle of the whole A-share market.

The historical trend of A-share restlessness in spring

The A-share market has spring agitation almost every year.

2006 was a big bull market. That spring, I mainly copied resources and commodities. After April, we found that the economic data was really good, so there was a trend increase in the market from April to June.

There was a strong agitation in the spring of 2007, but some junk stocks, including some stocks with poor performance, were the best to speculate. By April, the economic fundamentals were still good, so although there was a "530" in that year, there was still a wave of rise afterwards.

The whole year of 2008 was actually a bear market, but there was a "spring tide" at the beginning of the year. The most popular products in those years were some varieties related to the theme of inflation, including some agricultural products, potash fertilizer, medicine and retail. At that time, overall inflation was at a high level. In April and May, the economic downturn was found, and the market fell all the way from April to June.

In 2009, the situation was similar. The "Spring Tide" at the beginning of the year was mainly about investment products and new energy. After May, the whole real estate data began to improve, and full-cycle stocks ushered in a wave of rise.

20 10 is special because there was a real estate regulation before. By the middle of the year, the Beidaihe meeting had a tone change, so 20 10 showed a V-shaped trend.

20 1 1 "Spring Stir" hyped some high-end precision manufacturing, such as high-speed rail, and some stocks with supply bottlenecks, such as chemicals, steel and electricity.

Before 20 12, the main fried products were periodic products.

Take the end of last year and the beginning of this year as examples. At that time, the market was also looking forward to the agitation of spring. At the end of last year, the whole market was in a relatively restless situation. Everyone thinks that there may be a wave of market at the beginning of 20 16, and it may be more difficult in the future. However, due to very concentrated expectations, there was a wave of fuse decline at the beginning of the year, and the market was in a period of agitation in the months after the Spring Festival, but Z rose a lot in many sectors with low valuation, including supply chains and other colored varieties.

Therefore, in the A-share market, basically, in the first half of each year, or at the beginning of each year, the risk appetite is relatively high. At the beginning of each year, various themes or things that cannot be falsified will be speculated. These themes or things may not be directly related to the fundamentals of that year, and the market may not really show a trend until the second half of the year.

Causes of spring restlessness

At the beginning of the year, the economic trend was uncertain, and the plan to start a new project in one year was completely pushed out after the two sessions. Prior to this, new construction was relatively low, and migrant workers came back slowly after the Lantern Festival. 1 and the economic data in February do not reflect the economic situation of the whole year in essence. The adjustment of the enterprise's profit forecast will not begin until April, and will only be adjusted according to the profit expectation of the first quarterly report or the first quarterly report. Throughout the first quarter, the overall economic trend or fundamentals were not clear.

Before the two sessions, the policy direction was often not clear enough. But at this time, there will be various proposals and motions, and the market will have many expectations. Therefore, at this time, the whole environment will be particularly sensitive to policies, and the tone of policies will not be clear until after the two sessions, for example.

The impulse of banks to lend in the first quarter. Because it is for banks to lend early and enjoy the credit results early, 40% or more of the annual quota may be released in the first quarter, especially in some years with severe macro-control, banks will be more inclined to release more at the beginning of the year. However, these funds will not have much demand at the physical level at the beginning, because there is no desire to start work at the physical level at the beginning, so they often enter the virtual level. At the beginning of the year, the discount rate of bills or the whole bank's interest rate is relatively low, and the risk-free interest rate is relatively low, which also has an impact on the whole capital impulse. The relative cost of capital tends to decline.

Inter-annual distribution of domestic and foreign funds. Whether at home or abroad, there is this habit. In the sense of assessment, the organization may change a group of fund managers or researchers at the end of each year, and the newcomers at the beginning of the year will make a new round of layout according to their own situation, which may not be particularly in line with last year's style. In addition, investors have a higher risk appetite at the beginning of the year, because there are still many opportunities to recover the mistakes made at the beginning of the year, but the mistakes made at the end of the year are relatively difficult to recover.

To sum up these points, the characteristics of A shares will present such a state that there will be a so-called "spring tide" at the beginning of the year. After a period of time, there will be real "confirmation" or "falsification". If confirmed, it is likely that there will be an overall upward trend throughout the year; If it is fraud, then those who profit from the "spring tide" at the beginning of the year may be hurt later.

In fact, this situation often happens overseas. Some overseas funds are often laid out around Christmas, and then the so-called "selling in May" appears in May, and then recovered in July.

The "spring tide" in the A-share market may be just everyone's psychological expectation at first, slowly. 20 12 when writing this report on the characteristics of the a-share market, there was no such term as spring agitation in the market. In recent years, many researchers refer to this concept at the beginning of each year.

At the end of 20 15, the market increased its capital, which was aimed at the restless market in spring. On October 4th, 2015165438+/kloc-0, a relatively large positive line appeared. After this positive line rose, the whole market rose again. The market basically dried up two weeks after 1 1. This positive line led many institutions to think that there were more opportunities at the beginning of this year, so most of them were allocated at the end of last year. Many institutions have relatively high positions, but the expectations are too consistent, leading to collective lightening at the beginning of the year. The lightning happened to be blown this time, so the restlessness of spring was manifested in the form of falling first and then rising at the beginning of this year. In fact, this market fell at the beginning of this year. A month later, the market once again entered the sideways stage. In the sideways stage of the past few months, the market has also come out with many structural opportunities, such as agricultural products, nonferrous metals and liquor, which can also be attributed to the continuation of spring agitation.

Feature 2 of A-shares: "Show Time" and "Garbage Time"

"Performance time" and "garbage time" appear alternately.

"Performance time" and "garbage time" are actually a term in basketball. Everyone knows that the Lakers created the so-called "show time" in the 1980s. "Garbage time" is to send some substitute players to play when the overall situation has been basically decided. A shares have actually shown such a feature in recent years.

In the first half of 20 12, I once wrote an article called "A-share basketball theory", which compared some phenomena of A-shares with some situations on the basketball court, and listed five "show time" and two "garbage time" in the A-share market from 2009 to 20 1 1 year.

The core factor of the so-called "show time" is location. At this time, β may be greater than α; But in the "garbage time", the whole market will enter the so-called sideways stage. In fact, there are few opportunities for Beta at this time, but there are many structural opportunities. So if you can make a structure in "garbage time", you can also pull each other away.

Review the five "performance times" from 2009 to 20 1 1

1) The main swell in the first half of 2009

The root cause is 4 trillion in 2008. However, because investors doubt two questions: 1) Does the country really have such a big incentive and such a large-scale stimulus? 2) And does such a large-scale stimulus necessarily mean that the economy can get up? So when the decision of 4 trillion yuan came out, the whole index hovered around 1600-2000 for a quarter.

It was not until mid-June, 2009, 5438+ 10, that the market began to enter the main rising stage, and the index exceeded 2000 points. By May, the index reached the position of 2500 points. The main reason is that the above two problems have been solved. At that time, in the first ten days of June of 5438+ 10, many bank credits far exceeded the level of previous years. Finally, in June 2009, 5438+ 10, the credit 1.65 trillion, accounting for almost one third in 2008. At that time, when we saw this data, no one doubted the strength of the state stimulus. In addition, at that time, PMI data and ten-day power generation were greatly improved, and the economy showed obvious V-shaped growth. Seeing this data, everyone also believes that under such a big stimulus, the economy will improve soon. So in the first half of 2009, a wave of cyclical stocks rose by a large margin.

2) Main wave in August 2009

At present, the market drops by 800 points a month, which is equivalent to a drop of 25%. Why is there such a big drop? The fundamental reason is that people began to change their expectations of previous monetary stimulus policies. In the first half of 2009, the core factor driving the whole market to rise was the continuous release of water by monetary policy, but in mid-July, the whole repo rate suddenly rose, which made many sensitive people doubt whether the monetary policy had changed. On July 29, there were rumors in the market that the central bank held a meeting in Hangzhou, which may adjust the monetary policy in the second half of the year. Therefore, on July 29, the market came out and fell sharply, directly breaking the position. However, because the whole atmosphere of the bull market is still there, the whole market is still rising gradually from August 29th to August 3rd. It was not until the second negative line came out on August 3rd that the market entered a new round of adjustment (this situation is very similar to the stock market crash in June last year), that is, it fell like a storm, in which there was almost no correction, which was equivalent to a drop of 25% in one month.

3) The main falling wave in April is 20 10.

In April of 20 10, a very important factor was the introduction of real estate regulation. In addition, the stock index futures also came out in April of that year, which is equivalent to providing a short profit model. In April of that year, the GDP of the first quarter was released around 15, and the data was very high, which seemed to be 1 1.9%. Obviously, the economy is overheating. Subsequently, the the State Council executive meeting issued the standard of tightening mortgage. This day should be Friday. This data and policy did not cause too much tension, and the entire real estate index did not drop too much. But on Saturday and Sunday night, the State Council issued some detailed rules to tighten the mortgage standard, which attracted everyone's attention. Therefore, from April 18 to April 19, the Shanghai Composite Index fell by nearly 25% in the second quarter. This is also a symptom of "show time". In hindsight, this judgment is wrong, because export, real estate investment and new real estate construction all came down at the end of 20 1 1.

4) Main rising waves in the second half of 4)20 10/0.

At that time, after the 11th National Congress, the market rose by about 15% in two weeks, among which the leading sectors were coal and non-ferrous metals. The top gainer is Yang Guoxinneng, which may have doubled.

At that time, both foreign exchange holdings and PPI were negative growth, which means that the economy may have the taste of a double dip. In July, General Secretary Hu published the wording of relaxing the economy, and the market rose rapidly, from 2 1 19 to 2,550 points in a week. After crossing this position for nearly a month after 2550, the economic data began to stabilize gradually during the sideways period. If I remember correctly, the industrial added value in September of that year should have exceeded expectations. In the following holiday, the United States launched QE2. In fact, the QE2 policy was put forward during the Jackson Hole meeting, but it was not officially launched until the holiday. As a result, overseas commodities rose during the holidays, so the market rose rapidly after the return of 1 1 month, and then fell rapidly.

5) Three main waves of 2011year

20 1 1 The market began to decline in August and fell from top to bottom throughout the year 1000 points or so. There are several core reasons for the market decline: 1) inflation is higher than expected, which leads to the continuous tightening of the central bank's monetary policy; 2) Bank wealth management products 20 1 1 began to rise. At that time, the expected return on capital preservation of bank wealth management products was very high. At that time, the income of wealth management products was 1% at the beginning of the year and 10% in September. The return is very high, which leads to the stock market bleeding.

20 1 1 There are basically three main rising waves, with the highest price of 3,200 and the lowest price of 2,065,438+65,438. At the beginning of 2002,+213210.000 points fell.

Display time experience summary

The above summarizes the main ups and downs of 2009-20 1 1. If time goes on, we will find that after 20 13, the market will often have the main ups and downs.

To sum up, the important reason for the show time is often the change of macro variables, which eventually leads to the break of market equilibrium, which leads to the market choosing a direction. Once the market chooses a direction, the index often rises or falls more than 15%-20%. We can give an example. For example, in August last year, after August 19, the market experienced a wave of nearly 30% decline. The core reason for the decline is the RMB exchange rate reform of 1 1 in August, which improved the fluctuation range of RMB. This is actually a macro variable change.

It must be pointed out that it is not necessarily the change of macro variables that directly leads to the rise or fall of the market, but the market itself needs to choose a direction after a period of sideways. If such variables can appear at the macro level, it is easy for the market to choose the general direction. Before August last year, the market has been in a sideways state since July, so when macro variables appear in August, the market will make a direction choice in a very short time.

To sum up, when we invest in A shares, it is very important to pay special attention to the changes of macro variables after a period of sideways. If a macro-level variable changes, the market may choose the direction through this variable.

Review two "garbage time" from 2009 to 20 1 1

"Garbage time" means that the index level has not increased or decreased much. In fact, "garbage time" is not garbage, and you can often find a lot of gold from it. Moreover, in fact, investors' stock selection ability and industry allocation ability are manifested in "garbage time" rather than show time.

1) garbage time 2009Q4-20 10Q 1

During the six months from the fourth quarter to the first quarter of 2009, the market rose very little at the index level, and the Shanghai Composite Index only rose by 10%. And since the end of June 2009 165438+ 10, the market has basically been in a pattern of continuous shock. For strategic analysts, it is meaningless to shout more and empty in this case. Beta is not particularly important in this process, and location is not particularly important. In this process, in the second half of 2009, the new energy sector increased greatly, such as nuclear energy and wind power. By the first half of 20 10, the concept of regional theme has become a hot spot of investment, which is what A shares call "speculation map", and the excess returns are very large.

2) "garbage time" on February 20th101-201/

In the process, the overall index fell by about 2.5%. At this time, there are also many obvious excess returns. At that time, the concept of high-speed rail was very famous. In this environment, China North-South Car, Times New Materials and other stocks rose significantly.

Experience summary of "garbage time"

It will be interesting to find that the "garbage time" in the market often occurs in the first quarter, which overlaps with the restlessness in spring. Because when the spring is restless, it is impossible to expect a sharp rise in the index level. If there is a large increase or decrease at the index level, it means that the direction has been chosen, which is not just restlessness or garbage time. And there will be many theme investment opportunities in this process. For many investors, thematic investment opportunities or some meaningless opportunities are very uncomfortable, because it is difficult to choose stocks from fundamental judgments. But at this time, if you choose the right one, you will have a big gap with others in income.

To sum up the investment opportunities in the "restless" stage, the most important thing is that the market often chooses the continuation of the previous year or some hot spots, such as "garbage time" from 20101February to 2011February. The important topics of market speculation are supply bottleneck, fluorine chemical speculation and so on. So at the beginning of 20 1 1, there was a theory in the market called cycle repair and new cycle start, both of which were explaining this problem.

Why is this happening? In fact, it is related to the start of the cement sector in the second half of 20 10. In the second half of 20 10, the cement sector became a very important sector due to the joint price increase of cement. At that time, whether there was cement in the fund manager's portfolio was very different. At that time, researchers reported the changes of cement prices in a certain area almost every day. Because the increase of cement in the second half of 20 10 surprised everyone, in the agitation of 20 1 1 early spring, everyone was looking forward to finding a new variety similar to cement, and the whole logic of cement was the joint price increase caused by the supply and demand process, so everyone found many investment opportunities from the supply side, such as fluorine chemical industry and titanium dioxide, but such opportunities could not be mentioned in the same breath with cement. But in the whole spring tide, it also has great excess returns. But these investment opportunities also fell badly in the next 20 1 1 year.

From the point of view of "garbage time", the market may be in a trend-free state. When the market structure is more important than the trend, try to find the theme hot spots, not from the fundamental point of view. In addition, if there are some good themes that have been proved in the early stage, substitutes will be quickly pulled up in the later stage. "Garbage time" also existed in the first half of this year. After the fuse was blown at the beginning of this year, there was a wave of market rise. The characteristics of "garbage time" from April to June are very obvious, and the overall index has not increased much. The Shanghai Composite Index basically only has a fluctuation range of 100-200 points, but during this period, there have been many excess returns, such as organic light-emitting diodes for food and beverage, electronic components, rare earth and gold for nonferrous metals, and there are many structural opportunities.

These varieties are also traceable. For example, we found that the market began to fry 3D glass after frying organic light-emitting diodes. Why? Because the two are actually very close. Now that organic light-emitting diodes have been accepted by everyone, 3D glass is more easily accepted by everyone. For example, in the concept of new energy vehicles, the logistics vehicles that finally caught fire, some stocks can rise in a very short time, which is actually related to the previous new energy vehicle plate fever.

During the garbage time, we should pay great attention to one point: when the garbage time ends is related to the rotation of the market sector. You need to be very careful when you spin to make up for the increase. For example, after the cement sector rose, the fluorine chemical industry and titanium dioxide sector all followed suit, indicating that the garbage time of the industry in the market may expire and the market may enter the show time selection time.

A-share investment stage

In the A-share market for so many years, the investment mode is changing, but three modes have been popular for a long time: value investment (stocks are really cheap and driven by performance, such as Gree) and speculation of junk stocks (restructuring, backdoor, etc.). ) and theme investment (as long as the new concept is not falsified, the market is willing to invest).

Looking back at the investment stages of the whole A-share market in the past decade, it can be roughly divided into five stages. At each stage, there will be a kind of investment methods that are very popular, so sadly, the investment experience summarized in each stage may not be helpful to the next stage, and sometimes it will even be bound. Therefore, although it is necessary for us to sum up history, historical experience may not have a good guiding role in the future.

1 and before 2003, Zhuang shares were rampant in the A-share market.

I was a graduate student at that time and had never really experienced this market. But then I read a lot of books to study the "bull stocks" that came out during this period.

2. From 2003 to 2005, value investment rose.

The possible reasons for the rise of value investment at this stage are as follows:

Brokerage research: The Institute of Evil, represented by Admiralty, Shenwan and Guo Jun, advocates formal research of "value mining". Since then, there have been so-called three tables, profit matching, profit prediction, analysis of annual report and quarterly report, and investigation of company listing mode. In the bear market in 2003-2005, some stocks were found by this method, such as Suning, Maotai and Changyu, which gave high returns to value investors.

Public Offering of Fund stepped onto the historical stage as an institutional investor. The first Public Offering of Fund was founded in 1998, but the truly large-scale Public Offering of Fund appeared after 2003. Before 2007, Public Offering of Fund had a great influence on the whole A-share market. The emergence of these institutional investments and Public Offering of Fund's down-to-earth deep value mining have laid the foundation for the rise of value investment.

Since 2003, the selection of "new wealth" has appeared in the market. It has a great influence on the seller's research in the whole capital market of China, and indeed gives a high reward to the seller's research, adhering to the concept of value investment.

3. 2005-20 1 1 year, macro-driven, investment clock.

2005-20 1 1 year: macro-driven era, economic fluctuation, investment clock. Merrill Lynch investment clock came out around 2004, and China A shares took it as a bible. At that time, researchers were all macro-strategic researchers. When all researchers write reports, the 20-page ppt is basically 19 pages, which stage to analyze the macro, which point the clock points to, and the last page directly gives configuration suggestions. So at that time, the phenomenon that "everyone is a macro researcher" appeared. At that time, the study of the world economy was also very popular. During that time, research institutions such as Goldman Sachs and CICC had a great influence on the A-share market.

4,2012, it seems to be back in 2004.

This has been a very strange year. The annual index fluctuated little, but a lot of bullish stocks emerged. So 20 12 is a reward for investors who choose stocks from the bottom up.

5.20 13 to 20 16 is an atypical bull market.

The whole logic is a little different from previous rounds of fundamental analysis. After July 2065438+2004, the fundamentals deteriorated rapidly, but the stock market ushered in a full-scale bull market. It will be strange to use traditional fundamental analysis methods.

The main reasons are: the Internet has led to changes in the industrial base, the allocation of bank wealth management categories and the use of leverage, which has led to drastic fluctuations in the sources of funds, and the expected reform has triggered market agitation. Especially under the influence of the Internet, the bull market from 2005 to 2007 was essentially speculating on assets, and the hottest thing at this stage was the Internet industry, which paid attention to its profit model, data and the possibility of realizing it, without heavy assets, or even heavy assets became a burden. However, the Internet values the future, not the present. It doesn't matter whether you burn money or lose money now. Everyone is very tolerant of their performance in the past two years. So when the fundamentals deteriorated, everyone chose to turn a blind eye. On the other hand, the expectation of reform is really strong, and the Third Plenary Session of the 18th CPC Central Committee has been launched since the end of 20 12. Moreover, the use of bank funds and leverage, including the use of margin financing and securities lending, has a great impact on this aspect. So the bull market of 20 13-20 16 is very different from the bull market of 2005-2007. This bull market has greatly changed the education of many investors, including my own thinking.

Over the years, A-share investment has gone through several stages, each stage has different investment methods, and each stage is accompanied by the emergence of experts. Few people can always be masters. Perhaps one stage of research may not be applicable to the next stage. Therefore, we should always have an awe of the market.