The best moments of thematic investing

Since November, although A-shares have rebounded, there has always been a lack of a strong continuous main line, and the electric fan of market capital rotation is about to catch fire.

The Huawei chain of consumer electronics is out of flames and pullbacks, the chip is backed by a small composition to fry every three or five times, and the AI sector is looking forward to the US stock duo Nvidia and Microsoft can continue to make iterative breakthroughs, with a larger gap and greater upward momentum, but last weekend OpenAI was busy fighting for power, which also made AI companies lose hope for a short time.

When the market blindly invested flies, some funds began to speculate. For example, today, the BSE 50 Index, which has the largest number of small-cap stocks, outperformed the broader index.

At the beginning of November, according to the Shanhaijing stock speculation method, staring at the stock speculation with "animal" in the name of the listed company, for example, this year is the year of the dragon to speculate with the name of the "dragon", after the dragon speculation and then fry the "phoenix", the stock market once speculated into a zoo.

Since last week, from speculating on "animals" to speculating on "digital stocks", as long as they meet the requirements with numbers, small circulation, and good chip structure, they will be potential targets for capital speculation.

When speculation in digital stocks is underway, the market will also match these stocks with hype logic. But of course, most of it is seen as a joke, and this also shows the madness that appears in the market.   

For example, A-share Yao Ji Technology, the company has developed a short drama shooting business in 2022, and there are currently nearly 20 short drama crews, with short drama concepts, and the company's fishing games are in line with the AI game concept, and it is also the purest digital concept stock, because Yao Ji poker numbers 1 to 13 are available, and even send a pair of king fried.

For another example, the A-share New Wufeng is a Huawei concept + digital concept + pig cycle concept stock.

Another reason for this kind of speculation in the market is that there will be a "New Year's Eve big demon stock" in December every year, that is, small-cap stocks with poor fundamentals, and speculators are looking for this stock, and who will become a big demon stock?

For example, the A-share Sanboshuo has risen nearly 170% since October 24. By the way, with the sharp rise of the Beijing Stock Exchange in recent days, the reason given by speculators to the rise of Sanbaisho is that the digital concept stocks may also be the concept stocks of the Beijing Stock Exchange, because of the homonym, "Sanbaisho = three boards", three ten centimeters is not 30 centimeters of the Beijing Stock Exchange?   

For another example, "I have been in a fog in the past few days when I have speculated in A-shares, so I bought things in the clouds, and the more brainless I am, the happier I am."

So, how long will this kind of speculation continue?

In fact, this kind of speculation has also appeared in the past, and the sharp rise in micro-cap stocks is one of the characteristics of bottoming.

For example, from October 2018 to April 2019, when the A-share market gradually bottomed out, the market was frantically speculating on small-cap stocks for half a year, when the micro-cap index rose by more than 70% in half a year. Large-cap stocks, on the other hand, fluctuated for two months until January 2019, when they saw the market bottom, rising nearly 30%.

According to the past trend, the first and second rounds after the market bottomed out like to speculate on micro-cap stocks first, and large-cap value stocks reflect more slowly, because the market will game expectations, and some funds will bottom out before the economy and liquidity, and a small part of the funds will only speculate on micro-cap stocks, so the performance of micro-cap stocks is better in the near future.   

Now the market is experiencing speculation on small-cap stocks and large-cap stocks grinding and shaking.

For example, the Beijing Stock Exchange, which has soared in the past two weeks, has an average market value of 7-1 billion yuan and a very small number of circulating stocks, which has attracted the intervention of speculative funds.

In the past, the single-day turnover of the Beijing Stock Exchange was about 1 billion to 1.5 billion, and recently, the turnover of the Beijing Stock Exchange has reached 13.1 billion, breaking the previous record of the highest single-day turnover of 3.5 billion, which is 10 times higher than the average single-day turnover in the first half of the year, which shows the madness of market speculation.

However, the only shortcoming of the Beijing Stock Exchange is that the high threshold makes the liquidity still poor, and how to ship the funds is still a problem.

On the other hand, large-cap stocks, when the market bottoms out, are accompanied by clearance and stop-loss orders of some institutions, as well as the need to move positions.

Therefore, in the process of rebounding, the market is not rising smoothly, and there are many rebounds and more selling. If you look at the recent intraday performance of A-shares, the same is true, with frequent upward and downward movements.   

When these micro-cap stocks are hot, the heavy stocks of the institutions next door are still shaking and cutting meat. For example, the new energy index, CATL, etc., wait until the stop-loss orders of these institutions are sold out, and this type of large-cap stock can turn the situation around.

Although the reversal of micro-cap stocks will be ahead of large-cap stocks based on past trends, this kind of speculation is not suitable for all investors, and it is still necessary to be cautious and cautious when participating.

Why are market investors so negative about the Beijing Stock Exchange in recent days?

Or because the Beijing Stock Exchange has siphoned off the funds for speculating on "animal stocks" and "digital stocks", animals and numbers have been defeated by the Beijing Stock Exchange, and investors should be careful when they begin to improve their risk ratings on the Beijing Stock Exchange.

In particular, the Beijing Stock Exchange fund, which has been closed for two years, is about to usher in the lifting of the ban on November 23, and most of the funds have performed very poorly since their establishment, with negative yields or facing redemption pressure.

In any case, if you don't follow the hype of fundamentals, you will only end up with chicken feathers.

If you don't have the ability to speculate in the short term, you should stick to some good reasonably priced stocks, and don't sell your chips at a low price at this time to participate in this kind of 'cloudy' market.