The following words are relatively common, I hope everyone can understand them. The word "you" refers to a general term and is not specific to anyone.

1: What is a stock?

Many friends probably only learned about stocks in 2006 and 2007, because we experienced an unprecedented bull market. Stocks are one of the activities a company raises from the public in order to raise funds. Others include issuing additional corporate bonds, borrowing from banks and other financing methods. When a company first goes public, we call it an IPO (Initial Public Offering). The main purpose is to collect money from the open market, collect a sum of money, and then invest in our own company to achieve long-term profitability. Funds are the key to the development and survival of every enterprise. Whether or not there is money and whether there is enough money will restrict and affect the future of the enterprise.

The stock price can reflect the company's profitability and development level. Theoretically, if a company performs well and grows well, its stock price will increase accordingly, and the two should complement each other. This is just from a micro perspective.

From a macro perspective, the field in which the company is located, the country's policies and the economic environment will also limit the reaction of the company's stock price. To give a very simple example, the appreciation of the RMB, China's current economic growth is very fast, and the relative depreciation of the US dollar. A series of factors will affect China's securities market and stock market, entering a stage of vigorous development, which is what we call "big money". bull market”. Therefore, in this bull market, the stock price cannot well reflect the company's original achievements and performance, and is often overvalued. This is what we often see as "such and such stock is overvalued."

In comparison, in a bear market, stock prices are often undervalued, which means that the stock will languish, which also does not reflect the actual situation of the company. In this case, it often happens that many people's stocks are "trapped".

2: My personal experience

This is probably the aspect you want to know most. My personal ability is limited, so I can only talk briefly. I hope other friends can add more.

There are two major viewpoints in the stock market, one is fundamental analysis and the other is technical analysis.

(1) Fundamental analysis:

This is an important analysis method for value investors to look at the prospects of a certain stock. The so-called fundamentals refer to the company's own operating conditions. We can understand this from many aspects. One thing we must pay attention to is that no matter what kind of news we get, we must pay attention to the objective analysis of our own brains and make a conclusion before making a conclusion.

First of all, we can look at the company’s three-year report. If you don’t know how to read it and don’t have a deep theoretical foundation, then look at a few of the more critical subjects:

A Net profit:

This is one of the last items in the company's profit and loss statement. If this value is compared with previous years, it has grown very quickly, which can give people a sense of I feel that the company is developing relatively well. I just always feel that if you can find a company's report for 10-20 years and see that this project is developing relatively quickly, it means that the company's development is very stable. If the growth rate remains above 50% for a long time, the company's operating conditions We can initially judge that it is a period of high growth. Its stock is worth investing in, and we also predict that it will still be able to maintain such a high growth rate in the future.

One thing to note here is that don’t just compare this year’s results with last year’s. You must “shop around” and compare reports from several years ago. Otherwise, wrong judgments may occur. For example, if you compare the 2006 and 2005 financial statements of CITIC Securities, you will find that in 2006, this company has experienced great growth. Could it be that this company has undergone rapid changes? The answer is no. It is because the securities investment industry was in very good shape in 2006 that it will have a good performance in 2006. But it is not comprehensive to judge that this company is very good or very good based on this alone.

B: Net Asset (Net Asset)

In fact, the method for calculating net assets is very simple, you can find it on the balance sheet. It is total assets minus total liabilities. The increase in net assets can show that the company has a strong ability to repay its debts, thus avoiding the path of insolvency and bankruptcy due to large liabilities.

You can imagine that if a company's assets cannot cover its liabilities, then its stock should be worthless at all, because it may go bankrupt at any time.

C: Cash

At this point, I think anyone with some social common sense understands why cash is a very important thing. Without cash, it is impossible to carry out buying and selling operations. For a company, cash liquidity is a very important indicator. We sometimes hear that a certain company's cash chain was broken, resulting in bankruptcy. Think about it, if a company has no money to buy raw materials, how can it do business? No one is willing to sell things to you. Why? Because you don’t have any money to give! What will be the result? Then this company must be corrupt.

Of course, when the cash flow is negative, we cannot insist that the company will be destroyed. It mainly depends on its development. If the early investment cost of the company is relatively large, we have to look at it. Can we recover costs as soon as possible and make a profit in the future?

Secondly, the industry in which the company is located is also critical. I think many people will have different opinions on this point. For example, the current international oil price has been high, exceeding 100 US dollars a barrel. This is a growth factor for companies such as PetroChina and Sinopec that do business around crude oil; but at the same time, for companies that buy oil for processing, life may be easier. Why? ?Because the cost is high. Companies in the steel industry such as automobiles and equipment will be cyclical. They will be high for a period of time and low for a period of time. You need to understand this clearly.

Re-evaluating the situation and analyzing the current market will be very helpful for you to choose stocks. For another example, the country now has relatively strict policies on real estate and developers, which has led to some fluctuations in the stocks of real estate companies. For example, Vanke A, the largest and most powerful real estate developer in the country, has also experienced many ups and downs. Therefore, taking a look at national policies will be very instructive for you to choose stocks. But don’t blindly think that any new policies introduced by the country today, whether they are good or bad, will not be immediately reflected in the stock market. For example, the country raised reserve interest rates and interest rates N times last year, but our stock market is still bullish. However, the series of policies adopted by the country last year will gradually emerge, and it will only take time to accumulate.

The management level of a company is very critical. The level, vision, courage and charisma of senior leaders directly affect the corporate culture of the entire company. Whether there is a good leadership team is the key to the healthy development of this enterprise. Imagine a group of friends working together, even if they have a bit of industry, how can they develop and grow? Now is the age of knowledge. There used to be many upstart entrepreneurs and there will still be them now, but I can responsibly say that they will become fewer and fewer or even disappear in the future. Those who do not understand advanced management knowledge, do not understand the internal operations of a company, and do not know financial subjects do not have the qualities of a new type of outstanding manager, and we cannot trust their business capabilities. Investigating the leadership of the company is very helpful in selecting stocks. A good leadership team is more trustworthy, the stock price is stable and has long-term growth potential.

D: PE value (price-to-earnings ratio) price-to-book ratio; PB value (price-to-book ratio)

These two values ??are also a relatively direct way to measure whether the stock valuation is reasonable. PE It is the value obtained by dividing the stock price by the net earnings per share (Price/Earning per Share). The smaller the value, the smaller the stock is, the more it means the stock is not overvalued, and vice versa. PB is the value obtained by dividing the stock price by the net assets (Price/Net Asset). The smaller the better, and the smaller the value, the more investment value.

But you will definitely ask, how much is small and how much is meaningful for investment? Frankly speaking, it is difficult to say. Theoretically, it is compared with other companies in the same industry. For example, Kweichow Moutai and Wuliangye both belong to the liquor industry. In theory, their PE values ??should be similar. If Moutai's PE is 100 and Wuliangye's PE is 50, then we can understand Wuliangye At the current stage, it has more investment value than Moutai, and Wuliangye is relatively undervalued. Of course, my example is too absolute and too simple, and specific issues still require detailed analysis. If you compare Moutai with the steel industry, the comparability is not very great, so we generally don’t compare.

Some fund managers and investors compare the price-to-earnings ratio (PE) of a certain stock with that of the broader market. If it is lower than the broader market, it means it has a certain investment value, or they use this ratio from a historical peak (bull market). Compare the PE of only one stock to judge the investment value of this stock at this stage.

I personally think there is a problem with this comparison, because I have always emphasized that the general environment has changed. The bull market back then cannot be generalized to the current situation in China. The current bull market has richer elements than the previous bull market. , For example, our foreign exchange reserves have increased sharply, the pressure on our RMB to appreciate has increased sharply, etc., and our inflation has faced unprecedented challenges, etc. Therefore, the previous PE can only be used as a reference at best, and cannot simply become a reason for investment.

It is also problematic if we compare the current P/E ratio of the market with the P/E ratio of individual stocks. After all, the heavyweight stocks in the market are stocks that make your heart tremble when you hear their names, such as PetroChina and Industrial and Commercial Bank of China. China Construction Bank, these have contributed a lot to the stability of the market and the price-earnings ratio. Therefore, the PE of small stocks that often appear like a drop in the ocean in the broader market is not comparable at all. Because they are too small, the contribution of small stocks is completely buried. In other words, comparing such small stocks with the broader market, the difference is a bit far. . I personally suggest comparing it with similar industries in mature foreign markets. If there is really a stock that is similar to the PE of similar industries in mature foreign markets, wow, I congratulate you, even if you want to buy it even if you try to sell it. It's a pity, it's a pity~~~

Some people will say, you have said so much, but there is no way to distinguish, so how can you judge the quality of a stock. I say that every parameter has its meaning, and your personal judgment is supported by data or ideas. After your brain’s thinking, or the suggestions of other smarter brains, the final decision is often a comparative one. It is absolutely impossible to only look at one point. Some people just look at PE, and the lower the better. This is pure nonsense. Some companies have suffered losses this year and don’t even have a P/E ratio. Is it more valuable to invest?

(2) Technical analysis:

There are great differences in technical analysis because it requires strong data support. Judging from traditional experience, the rules summarized from past events are of great help in making judgments in the future. Although I personally don’t agree with this, because if we use the concept of the past to explain the future, time is changing, and the situation is also relatively changing. At most, it can only be used as a reference, but it cannot become a standard for judging the future. Technical analysis methods are relatively complex because they require the support of statistics and econometrics to be implemented.

To put it bluntly, using past data experience to predict the future and K-line charts can actually be classified as technical analysis. For example, we sometimes see people talking about Yinxian, Yangxian, Doji, etc., which are more or less involved in the concept of technical analysis. There are many opinions on this, so I won’t go into details here. You’d better buy a simple stock trading book, which may explain it in more detail.

I personally believe that technical analysis can be applied to short-term speculation and speculation, while fundamentals are suitable for long-term value investment.

(3) About the legendary banker:

I believe many people think that there is a banker in the stock market, and the banker’s opponents are small retail investors. I personally cannot accept this idea. Among small-cap stocks, small stocks with a market value of billions or hundreds of millions can easily be artificially hyped. If you blindly follow the so-called bookmakers, you may lose a lot of money. miserable. In this market, small retail investors always have less information than large institutions, and it is very untimely. When the so-called bookmakers are running away, you can still enjoy the pleasure brought by this short climax. The result is that all the profits are thrown in instantly. If it is good, it can end at a cost, but if it is bad, it is deeply stuck. So don't blindly believe in the news released by the "bookmaker". It's still the same principle. Use your own brain to think about it. If you want to make money but are unwilling to spend time thinking about it, there is no such good thing. Unless you buy a very good fund, don't forget, because public funds have many restrictions, and the threshold for private funds is sometimes very high, so you still need to make your own judgment in many cases.

We sometimes have relatives or friends say that such-and-such stock is good, this, and this is good. So I bought it. This kind of thing is actually pure luck. First, the delivery of information is becoming increasingly inaccurate and has great delays.

When you hear about this, the dealer may have already arranged a formation and is waiting for you to take advantage of it. Moreover, the price at which to buy and the price to sell are subject to great market volatility. Don't think that bankers are gods, they are just people with more money than you and some financial knowledge. When the entire situation changes, or an unexpected situation occurs, they will also lose money, even worse than you, because their money is basically raised and they are under great pressure from investors. Don't be superstitious about bookmakers. You may have benefited from it once or twice, but there will definitely be times when you lose money. When you calculate your average rate of return after one year, I'm afraid you will find that you haven't firmly grasped it all the time. Stock returns are high. Because frequent operations will cost you time, energy, handling fees, stamp duties, etc., etc., it is a bit of a gain but a loss. Unless someone you are particularly close to works in a securities company or fund company, it is best not to blindly listen to the news. Of course, the relatives who leaked the information to you are breaking the law. If you don't pursue it, you will be prosecuted. If you pursue it, it will violate the criminal law.

3. My personal suggestions:

(1) Never be blind

But most investors in our country cannot make long-term investments. Choose short-term speculation to make money. Our national economic and financial knowledge base is not as mature as that of Western developed countries. We often listen to other people's news and adopt a blind investment method. In this regard, some people make quick money and become more and more crazy. In fact, they are often the final losers. After all, when everyone is praising the good market, potential dangers will come. Old investors who have experienced previous bear markets should have felt it, investors who have experienced 530 should have felt it, and new investors who have experienced the adjustment in November should also have felt it. The stock market is like a scourge, and there is no way to stop it. Every day, the mentality of many people is, let it fall, and everything will be fine before the 2008 Olympics. Yes, this idea may be okay for a while, but we can hold a few Olympic Games, so why should the Olympic Games be linked to the stock market? In fact, we all know that there is no direct blood connection between the two. Even if a large number of Olympic venues are built, only some companies will benefit, and Beijing will get the projects. Throughout history, it is true that the securities markets of many countries will be relatively active before the Olympic Games. This is only historical data from the past and cannot fully represent the future, nor can it fully represent China. Many people have overlooked that many countries have entered a long period of addiction after the Olympics.

I won’t say much about listening to the news. After all, I expressed my own thoughts in the previous description of the banker.

Don’t invest casually without thinking through your own brain. You just don’t understand. Just ask someone who understands. I'm not asking you to ask whether this stock is good, but whether this company has investment value.

(2) If you really don’t understand, you can consider investing in funds.

Comparatively speaking, fund managers have more extensive and professional knowledge in the financial and economic fields (nonsense, professional, just do it). Their advantages lie in their work experience, past glorious achievements, and their analysts. At a certain level, a large amount of funds can be integrated for investment, and the rate of return does not need to be too high, as long as you make money.

But they are still humans, not gods, and the halos placed on their heads will also become ultraviolet rays that burn them.

A. Rich work experience will lead to a rigid investment philosophy and lose a lot of shining points;

B. Past achievements cannot explain the problem at all, because the past things can only explain the past You grasped the opportunity well, but no one can say it right now. In the ancient language, a hero does not mention his bravery in his past.

C. If the corporate culture is not good, many of my analysts will want to change jobs. No matter how good a person is, they cannot be involved in every field. Those who work in the steel industry have only dealt with the steel industry for several years, and those who work in the energy industry only care about their own affairs. They all have limitations;

D. The fund is huge, but you can’t use it casually. You can’t invest it all in one place. If you lose, won’t you just lose it? The country does not allow children to misbehave. If you want to play with people's money, you must allocate funds honestly and in accordance with the country's policies. This may also miss some investment opportunities. Of course, the risk will be relatively smaller. "Don't put all your eggs in one basket." I heard that this is the Bible in the financial field. I personally don't agree very much. We will talk about this later.

Okay, I have mentioned so many shortcomings, just to tell some investors that the level of these investors is far inferior to that of a fund manager, so it is sometimes a good choice to be safe and at least believe that people who are stronger than you are sometimes .

What I want to remind you is, don’t just buy one fund, because after all, the fund is different from your own operation. At this time, we need to carry out risk differentiation investment. Mix it up with hybrid, aggressive, stock, bond, etc. You can make less money, but you won't necessarily lose badly. (What? The fund will also compensate, of course it will, they are not gods)

(3) It is better to cut off one finger than to hurt ten of them

When you encounter a good opportunity, Don't pay attention to the concept of risk diversification investment, the rest is a bit nonsense. If the opportunity is really good, don't spare no effort and invest all your money within your debt capacity. Good investment opportunities are rare, but they are not impossible. We need to slowly discover them. For example, this year, we will buy new stocks (buy the original stocks by lottery and sell them when they are listed). If you are strong enough, 10-20 million. It is estimated that the rate of return on new shares in 2008 will be 25%, with no risk. You may feel that you are earning less, but there is no risk. If you invest all this money in stocks and fail to protect it, you will lose money.

(4) If there is a plan for merger, acquisition or reorganization, buy the stocks of the company being merged or reorganized in advance. But this process is very long, and the information is not very accurate. If you know the exact news, don't miss this investment opportunity. This method is a common trick used by many large investment banks. Of course, we need to analyze it to see if the two parties (the acquirer and the acquiree) have the strength to produce a result of 1+1>2.

(5) You must have a good attitude, which has a lot to do with personal cultivation. Don't use it to gain happiness, don't use it to compensate for sorrow, because these are just passing clouds and will eventually turn into dust after a few decades. Of course it is worth celebrating if you make money, but don’t be greedy. This is the essence of our traditional culture, and it makes sense. Even if you lose money, don't be too sad. With good capital operations and driven by good investment concepts, these losses are temporary. Good stocks are the first choice for permanent investment. If you can’t get involved in the ST sector, it’s best not to get involved. Don’t be jealous when you see others getting huge returns on their investments, because some money is not what we should earn in the first place. Just think about it, if we were born into a wealthy family and became a high official, our lives might be completely different, but we are not. So don't be jealous of others. After all, there is some money that cannot be made in the stock market.

ST Wanjie, which has been closed for nearly a year, has finally been able to reorganize. With the last two daily limits, many people feel, wow, this opportunity to make money has been missed. But think about it, the people holding these junk stocks have been waiting for almost a year! ! ! I don’t think I need to mention how many investment opportunities I missed in the process. It may not be worth it. Moreover, if Wanjie fails to reorganize successfully, their money will evaporate. Isn't this dangerous?

ST Jintai created a historical myth, and many researchers are exploring the root cause. Finally, after its glory days, the government stepped in because this abnormal form only happens once in a century. You and I are mortals, so why bother pursuing it?

Don’t be greedy. You have to sell at the highest point and buy at the lowest point. Unless you have excellent special functions, I personally think it is impossible. You don't need to eat the fish head or tail, the middle part is still delicious. Many people always say, Oops, it was sold too early, Oops, I didn’t buy it at that time. Isn't it just a greedy mentality at work?

With 5,000 years of Chinese tradition, thoughts such as Confucianism, Wuwei, and Doctrine of the Mean can actually be used as a supplement to our personal cultivation. Everyone has the same level of knowledge. Whatever you look at, your mentality is not arrogant or arrogant. This is a true gentleman.

(6) Set the investment amount reasonably

1/3 pocket money, 1/3 saved as a current reserve, 1/3 reinvested, this way you will always be a winner. Don't be afraid to cut your losses. If you accidentally buy junk stocks, don't hesitate to set a stop loss point. For example, you can sell if it falls to 3-5%. Even if this junk stock goes up in the future, don't regret your decision, because it is very likely that you will lose everything due to your indecision. There are three stocks that are very good, but they are overvalued now. But if you plan to invest in the long term for 10 years, these are good choices. Of course, I am not telling you to buy them now.

Kweichow Moutai, China Merchants Bank and Vanke A, if any friends are interested in seeing whether these companies meet the conditions for good stocks I just mentioned.

Finally, I would like to say that the stock market is risky and investment needs to be cautious.