Article/Huang Liming, columnist of Sina Financial Opinion Leader Column (WeChat official account kopleader)
The leverage of margin trading will further aggravate the stampede and avalanche of the market in the event of future collapse. A rich number game will finally say goodbye to the fantasy of getting rich overnight and return to normal life. When avalanches occur, no snowflake feels responsible.
Will the crash be a preview of the crash? An intimate photo puts "we" on the top; A sharp fall has dislocated shareholders; An invitation to resign made the boss of Huijin stand out.
After the crash, the CSRC [Weibo] The Weibo once closed its comments, but Xie Zhichun, the boss of Central Huijin, who had reduced his shareholding in the four major banks, resigned, which was misread as the dismissal of being punished for reducing his shareholding. In fact, People don't care who goes and who stays. They only care about why they save the bottom of shareholders and smash their shares. The investment thinking of only allowing rise but not falling reflects the irrational bubble of China's stock market.
Delin Society has always believed that the bull market will continue and the bubble will continue. Just, The two sharp falls under the amplification of leverage, we can see that this is probably a preview of the future collapse of China's stock market.
We in A-share are Chinese investors embracing bubbles.
6.5%, the historic 5.30 plunge of A-share, which was replicated on May 28 eight years later. What is more frightening is that shortly after the opening on May 29, the Shanghai Stock Exchange Index continued to plummet 4.08%. Fortunately, it was later pulled back to the normal track.
It is unknown where the peak of this bull market is. Because the double easing of money and finance, the stock market relocation of savings and real estate investment, and the financing balance of borrowing money to speculate in stocks have pushed up the three capital bases driving this bull market, and there is no sign of change in the foreseeable future.
Both Huijin's reduction of holdings and clearing of OTC funding are just a way for regulators to regulate the rhythm and bubbles in the short term. Otherwise, it will not only reduce Huijin's previous holdings, but also restrict the allocation of capital, which will result in stamp duty.
If this slump is seen as a preview of a big crash. When this bull market ends in the future, we can see how tragic it will be. We are used to comparing this to the stampede of the stock market. In this two trading days, the sharp drop of 10.32% was undoubtedly a serious trample on the stock market.
In China's stock market, bubbles are no longer a taboo term for analysts and investors. The biggest feature of this bull market is the leveraged bull market under margin trading. The balance of margin trading has soared from 700 billion yuan last November to 200 billion yuan so far. At the same time, all kinds of over-the-counter funds - unconventional borrowing funds for stock trading are also considered to be nearly two trillion yuan.
I have heard many times from people in the financial circle, In this bull market, whether the regulators have the ability to prevent the stampede tragedy for such a huge financing order. The answer is, at least for now - no.
Driven by human greed, the bull market is a bubble process. From the Dutch tulip bubble, it rose 59 times in two years and fell 90% in six weeks; The French Mississippi bubble rose 35 times in 13 months and fell 95% in another 13 months; The South China Sea bubble in Britain increased 8 times in 6 months, and then fell 80% in the following 3 months; In the US science net bubble, the NASDAQ rose 2.5 times in two years, and fell 80% in the next two years.
The rise of 10-20 times in the global historical bull market is really far from the 1.5 times and 5 times increase in the main board and GEM. It is unknown whether the history will simply repeat. This bull market has no profit support for the time being, just a pile of funds.
China's stock market has always been a "crazy casino". Value investment is just a slogan, and speculative casinos are the reality. In a bull market, greed makes people ignore risks and constantly buy to push up prices. Bubble is the inevitable result; In a bear market, fear makes people ignore the intrinsic value and keep selling down the price. A big crash is also an inevitable result.
Where is the upper limit of borrowing financing in this bull market? Referring to the Taiwan stock market, facing the total market value of A shares of 60 trillion yuan, the upper limit of the demand for financing and financing is 3 trillion yuan, which will also rise in the future. It seems that the current record of two trillion yuan financing order is only temporary.
After the 7.7% plunge of the two financing risks in 119 inventory this year, the stock market plummeted this time, and Chinese shareholders learned the other side of margin trading leverage. Selling and cashing out due to margin increase will cause a more violent slump, as can be seen from the short-lived 188 point slump on May 29. The effect of leveraged funds on amplifying the decline of the market has also led to an average decline of 1.65% in the Shanghai Stock Index this year, ranking first among the world's top ten stock markets.
Don't let a thief eat meat without seeing him beaten. When embracing bubbles, we need to use leverage carefully to prevent the risk of collapse. Never think of selling perfectly at the high point and copying perfectly at the low point, otherwise investment will not be a happy journey.
Although there will be a shock in the future, Delin still believes that the bull market is still there. However, there is no doubt that the leverage of margin trading will further intensify the stampede and avalanche of the market in the future crash. A rich number game will finally say goodbye to the fantasy of getting rich overnight and return to normal life.
When avalanches occur, no snowflake feels responsible.
(The author of this article introduces: the producer of Delin's explosive language, and a former senior reporter of Beijing News and Economic Observer)
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