5-year bear market after the 2000 points how to beat the bull market Money Tips

Category: Money tips Release Date: 2007-06-30

In 2006, the stock, driven by policy changes, the stock market bear market was finally out of the shadows, embarked on a journey of a bull market. Looking ahead to 2007, the stock market bullish factors still exist, but the difficulty in the operation increased. Only understand the nature of the bull market, grasped the bull market on the basis of context can be achieved in a bull market should benefit.

Since July 30, 2001 after the Shanghai Composite Index once again stand on the 2000 points so that has been tortured by a 5-year bear market investors in the stock market rejoiced. However, faced with rising indices, there are still many investors will feel confused, first, the current index is not too high, how much broader market up space; second is the index rose is great, could be in the hands of the stock is not how to make money, what is the reason. Let us come before to understand what the nature of this year's wave of bull bar.

Shares on the index rose contributed in no small

Although the Shanghai index has many defects, but we still the most accustomed to using the index. From the end of last year's closing-bit 1161-point rose to November 21 of 2037 points, or 75%, indeed risen dramatically. In such a large rise in the role of new shares is very clear. End of last year, the Shanghai index corresponding to the total market value of 2.31 trillion yuan, to November 21, with a total market value increased to 5.29 trillion yuan, an increase of nearly 130%.

As of November 21, Shanghai stock market this year, an increase of only 9 new shares, but each is large capitalization stocks, especially China Industrial and Commercial Bank of China and Bank of China, the growth of the total market capitalization have made great contributions. By November 21 closing price of 9 new shares of the total market value (not including the market price of H shares) reached 1.82 trillion yuan. Remove the 1.82 trillion yuan of new shares, the remaining is the original index's gains. 5.29 trillion yuan minus 1.82 trillion yuan, and the remaining 3.47 trillion yuan, which is the old index corresponding to the total market value. From the 2.31 trillion yuan rose to 3.47 trillion yuan, or about 50%. In other words, excluding shares of factors, the Shanghai index's gains should be 50%, the corresponding points to 1744 points, with 2037 points, a difference of nearly 300 points. Therefore, our feeling is that index rose much more, but making money is not so much.

However, we have not earned the money should not look at index, or total market value, but should look at the circulation market. Industrial and Commercial Bank of China are now market is very large, close to 1 trillion yuan, accounting for the currency in Shanghai stock market reached 18%, the first big heavyweight. However, the flow of the market value of ICBC was not large, only 200 billion, lower than the China Merchants Bank. End of last year, the Shanghai stock market value of about 682 billion yuan in circulation, November 21 to 1.237 trillion yuan, of which 9 shares contribute to the flow of the market value of 756 billion yuan, remove the impact of the new flow of market capitalization increased by 70%. In other words, participation in this year's investments in stocks, the average profit 70%. In this 70%, 30% from the share reform, is made by the policy, and the other 40% rely on skill, and in the market achieved.

In this wave of bull market, only the Shanghai stock market rose more than 100% of the shares will have 285, or more than 50% of the shares had 724. In the 840 stocks, 86% of the stock has jumped more than 50 percent this year, if you do not make money, it is surely relevant in your operation.

Breaking all-time high point of 2245 is not a problem

Index has risen so much, the next will be up do? To answer this question, we have to analyze in two ways, first, whether the current stock price is overvalued, and second, how will the future issuance of new shares.

First look at valuation. As of November 21, Shanghai and Shenzhen stock markets weighted average share price of all stocks at 5 yuan, the first 3 quarters of 2006 the two cities an average of 0.199 yuan per share, the average net assets of 2.4 yuan per share. This year's performance of listed companies show a quarter higher than a quarter of the characteristics of the first 3 quarters about 0.2 yuan per share for the fourth quarter of 0.08 yuan is entirely possible. In so doing, full-year earnings per share of 0.28 yuan, the corresponding average price-earnings ratio less than 18 times, with an average of 2.1 times book value. This valuation should be reasonable, and even some on the low side.

Let's look at the issue of new shares issued. There is intention to issue A shares a lot of big companies, such as the oil, which is the most profitable companies. Last year its net profit was 126.6 billion yuan, Sinopec is China's three times more than China Petrochemical, Industrial and Commercial Bank and Bank of China's three more than the combined profits. Once the oil market, total market value of Shanghai stock market will certainly be increased significantly. In addition, China Mobile, China Telecom, China Life, Ping An Insurance and other big companies are waiting in a queue waiting for the A shares. If these large companies listed on the part of the next year, maybe the total market value of Shanghai and Shenzhen stock markets will be close to Hong Kong stock market. Now the two cities a total market capitalization of 6.7 trillion yuan, Hong Kong is the Hong Kong dollar 12 trillion. Listing of large companies will inevitably contribute to the index this year, shares contributed nearly 300 points, next year will be more no less, so that seems to break a record high point of 2245 should be a certainty.

Grasp the bull market of the three main lines

Despite the year for the index will go up, but the operation more difficult than this year, because in the future no longer such a preferential share reform, and could not make money will depend on individual skills. Although the stock market this year, earned an average of 7 into, but into three policy changes depend on the stock, 4 into, and ability. In this case, there is a lot of people earn 70% of the people. No policy changes next year, stock, and certainly difficult to make money higher than this year.

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So, next year's Quotes will be how to develop? I believe that next year's bull market will be launched along three main lines, the first institutional bull market; second, M & A bull market; third largest shareholder is the bull market.

Thread 1: Institutional bull market

Next year's bull market first look at the institution's position. Institutions are now what the situation? Of course, the fund's largest sector, at present the funds available for investing in stocks no less than 500 billion yuan. Institution is the second largest insurance companies, insurance companies, the assets of 2 trillion yuan, the stock market compared to 5%, about 100 billion yuan. The third largest institution is QFII, 85 million lines, nearly 700 billion yuan. There are brokerage has a 600-billion of funds invested over 200 billion yuan of social security, the total amount of 7,500 billion yuan of funds. The November 21 in Shanghai and Shenzhen A shares after the close of the market value of the total circulation of 18,000 billion yuan, 750 billion yuan is a very large proportion, that which does not include private equity funds, finance companies, investment companies state-owned enterprises and large shareholders. With these institutions of funds, institutional investors, fund important than the total market, more than 50%.

Next year, the size of equity funds will continue to expand, according to the current size of the monthly increase of 200 billion calculations additional 2,000 billion fund is not a problem. QFII quota for next year are likely to increase to 150 billion U.S. dollars, the proportion of insurance funds, the stock market may increase to 10%, as well as the additional social security funds, brokerage money market, and so bring a total of additional 500 billion yuan of funds is entirely possible. In this way, institutions accounted for a market capitalization of the amount of funds is likely to exceed 60% of the proportion of the retail gradually being marginalized. This is the institutions bull market characteristics.

Agencies how the bull market will bring kind of investment patterns? Of course, is to buy blue chips mainly for three reasons. No. 1 blue chip stability is better, the fund holds the hands of 10 billion yuan of funds, such funds will certainly be a large selection of some relatively large plate, good liquidity, Do not look at the current total market capitalization of 6.7 trillion yuan, but the -float market capitalization of 100 billion yuan of shares is only 19 and 50 billion yuan of 51. Since the body is inside the main fund, they are likely to choose a number of large capitalization stocks, which is by the blue chip mobility decision. Second, because the next year, wants to open a stock index futures, the case of callbacks in the stock market institutions can short index, short selling stocks. Of stock index futures margin ratio is 10%, equivalent to 10 times larger. To do an empty index, the hands must be stock. Because the financing is still relatively easy to handle, Securities Lending difficult, Taiwan does not have specialized Securities Lending Company, only by buying its own stock and then short-selling. Third, the relative valuation of blue chips is not high at present, there are still some discount, especially those with some leading blue chip shares relative to H is still a certain discount, which is also a very important reason.

Theme 2: M & A bull market

M & A market will always be the most popular topic for next year's bull market bull market can also be known as the injection. Before the stock market, large shareholders think the law needs to hollowed out, and now think the law needs to inject. Why is this so? Because the stock market has a multiplier effect. For example the majority shareholder injection of 100 million yuan of profits, calculated according to 10 times earnings, that is, one billion yuan. Prior to the 10 billion is not available, 100 million yuan on the hands of major shareholders is 1 million injected into the listed company, major shareholders do not come to 100 million yuan to get, because its shares did not flow can not enjoy the multiplier effect.

There is such a good multiplier effect on the majority shareholder of course willing to inject quality assets, because fancy that time, the number of times you can cash earnings. Even without cash, the market is also a market value of the wealth, wealth is worth in, you can With this wealth, by virtue of these worth to the bank or somewhere else financing, it entered into the stock market is a small number of out is a big The number of the basis of this large number can also get more money, which is the stock market wealth effect, this wealth effect only in the full circulation of the times can, if not this premise, hollowing out is an inevitable act.

Theme 3: major shareholders bull market

In the stock restructuring before the major shareholders do not care about stock prices, because its value is not reflected in the share price. It uses part of the shares on the possession of all the assets of the company, major shareholders of the most advantageous thing is hollowing out listed companies. Now, the stock value also determines the major shareholders, large shareholders, the bull market finally emerged. Bull market in which a number of major shareholders which stocks can be profitable? I think that is a major shareholder with a relatively high proportion of one is low. Major shareholders holding more is definitely more concerned about the price, and truly made the final emptying IPO to do what little scam, because holding a high proportion of all the good things out, and no society will be a good thing up close, Therefore, the majority shareholder holding a high proportion of shares easier to go up. There are major shareholders equity ratio low, such as 20% to 30%, the share price should lower the acquisition, control may be lost, so like this company would be to maintain its share price.

In summary, the valuation at a reasonable level, the new high-quality enterprises are listed on the backdrop, the stock market is bullish next year, things could be established. Next year's bull market, but there are very different this year, policy-related factors are missing, the operation difficulty increased. Investors can take from three aspects of the stock market next year, one in accordance with the idea of institutional investors, holdings of blue chips; second is concerned about those who have the assets or the acquisition of subject matter into the company; three major shareholders are concerned about the maintenance of price movements公司. Grasp these three main lines, it is possible to achieve a good investment in the stock market gains.

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