Category: Money tips Release Date: 2006-02-08
Idea is that investors invest in the stock price movements based on the views of the nature of the pursuit to meet their own risk appetite returns on investment ideas. Generally divided into two modes, namely fundamental analysis and technical analysis school of school. The former believe that the decision on the company's stock price or future earnings prospects, investing in stocks is an investment in the company's future; the latter is that the stock price by supply and demand sides and decided to forces of supply and demand is not the company's fundamentals, but rather people's psychological factors .
School of fundamental analysis as the development and improvement of value and growth investing into two main branches. The former believe that the main purpose of investing in stocks is to get an annual cash dividend. The latter view, the main purpose of buying shares is to obtain the price difference rather than cash dividends, the premise that the past performance of the company's excellent growth, the future will continue to maintain a good growth momentum, which measure the "performance" is that the two main indicators of main income and profits, location "good" the main reference is higher than the industry growth rate in general. Experience has shown that in mature markets, in the stock market, cattle, bears alternating movement, value and growth can only compound (such as the value of growth), can not be replaced, and, value or growth, regardless of which side can never occupy the dominant position of market . Therefore, a high degree of enthusiasm to follow the high-growth stocks are a necessary development in the stock market Quotes stage, and at this stage, investors get a higher rate of return. This highly enthusiastic support forces from the target company's high-growth expectations, but the high growth is expected to eventually lead to the disillusionment of an overdraft, the inevitable will return to value investing model, cyclical, cycle, changes in investment philosophy presented periodic cyclical nature. The law has evolved in China's stock market as a saying that "to see the bull market trend, bear to see the quality."
Based on the above conclusion, we is not difficult to analyze by the end of 2005 since the bull market, why do some value stocks are far below the market rate of return average causes. Yangtze Power is a typical example of them. The Shanghai Composite Index since the beginning of 2006 to June 30, up to 44.02% over the same period or longer only 1.15% of electricity, even if the warrants in accordance with a long electric power grab Quotes calculate the maximum price of 9.97 yuan, which rose only 14.47%. This can not but strongly recommended during this period all electricity analyst long embarrassment. This embarrassment is actually experienced growth in the value of the embarrassment that is the bull market do not look at a qualitative look at potential embarrassment. Because no matter what valuation method, the value of a long power is obvious, but even taking into account the poor performance of this year's runoff, performance decline and other factors, the relative price of the company in its current intrinsic value, also belongs to be underestimated. However, due to the time of its acquisition of units can be achieved until 2007, the market for such a temporary shortage of the value of growth stocks clearly given a negative position.
From Benjamin Graham launched the "Security Analysis", the "rational" has been deeply rooted in the securities field of investment, but the frustration is that the development of securities analysis to this day still can not be called science, relies solely on "rational" investment needs Investors have enough patience and overcome fear and greed of the psychological preparation, holding his long-time power of this value stocks, it is necessary to follow the growth from the market to bear the mockery and trouble.
