Market Takeoff: Brokers' Investment Tips Amid First Wave's End

During the National Day holiday, the rise in the Hong Kong stock market made many A-share investors envious. On October 9th, both Hong Kong and A-share indices experienced significant shocks and回调s, with the Shanghai Composite Index falling by more than 5% in the morning, and the ChiNext Index falling by 7%. Individual stocks showed a general downward trend, with more than 5,000 stocks falling.

As of the midday closing, the Shanghai Composite Index reported at 3,304.84 points, down 5.30%; the Shenzhen Component Index reported at 10,783.40 points, down 6.19%; the ChiNext Index reported at 2,364.26 points, down 7.29%.

Faced with the overall market trend, many investors fell into the dilemma of "Should I buy? What should I buy? How much should I buy?" At this time, several securities firms gave their predictions, with some believing that from a valuation perspective, the A-share market still has a safety margin, and influenced by policy support and improved market sentiment, the short-term momentum is strong.

At the same time, facing the previously hot market, securities firms such as CITIC Securities, CICC Wealth, and Guojin Securities have also carried out investor education. Top securities firms have issued risk warnings, reminding investors that investments should be made with idle money, leverage should be used cautiously, blind following should be avoided, and betting on a single stock is discouraged.

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Guojin Securities suggests maintaining a normal mindset and earning long-term money, "If you do not have a deep understanding of the market and investments, please always remember: 'Risk = Return'. Although the 'storm' is greater, the fish is more expensive, but the risk also increases. Seeking short-term high returns is equivalent to gambling. It is better to consider calming down, taking a long-term view, and accumulating returns."

At the same time, diversify investments and earn trend money. In a good market, there will be differences in the rise and fall of specific industry ETFs and individual stocks. Although portfolio investment may not yield extremely high returns, it can also diversify risks and have a higher probability of winning.

CICC Wealth points out that when the market takes off, it is more important to sit firmly and hold on. CICC Wealth points out that "oversold rebound" is a simple rule in investment. After three years of adjustment, the overall valuation of domestic assets has reached a historically low level. After a deep squat, it is waiting for a trigger to reverse and jump. A series of recent policy "gift packages" have reversed the previous pessimistic expectations and low spirits, and have also driven the revaluation of Chinese assets.

CICC Wealth points out that the current market's medium-term bottom may have been formed. More importantly, we should believe in the fundamentals of our country's economy and the vastness of the market, believe in the strong resilience and great potential of our country's economy, and maintain long-term confidence in the continuous development of our country's capital market. However, the market's short-term heat is rising and transactions are continuously warming up, which is also a signal that we should pay attention to the rhythm and direction of participation. Next, we might as well pay attention to two aspects: one is the recent and future comprehensive and sustained efforts of a series of policies, including fiscal policies; the second is the support of the macro fundamentals, which will be the key to long-term trend opportunities and market stability.

CITIC Securities stated that the most difficult time for A-shares has passed, confidence is gathering, and various targets are still at the bottom of valuations. The market has just started not long ago, and it is indeed a relatively comfortable entry window. For investment novices, the following points should be noted:

First, long-term money is easier to earn than short-term money. For those who do not understand the market and investments deeply, short-term speculation is equivalent to gambling. It is better to exchange time for space, take a long-term view, and accumulate returns. Second, trend money is easier to earn than individual stock money. Even in a performing market, individual stocks will also show differentiated trends. By buying indices or portfolio investments to replace full-position bets on individual stocks, the probability of winning will be higher. Third, do not put all your eggs in one basket and maintain a decent presence in the market. Market fluctuations are the norm, and only by staying in the market can you not miss the dividends of each round of increases. What is the capital to stay in the market? It is to use money that can be afforded to lose and maintain positions. Always invest with idle money and do not let investments backfire on life.Several economists have also offered relevant suggestions. For instance, Zhang Aoping, Managing Director of Ru Shi Capital, told Interface News, "The market is currently in a period of observing the implementation and materialization of a series of incremental policies introduced earlier, as well as the introduction of subsequent proactive fiscal policies. The market will be dominated by structural trends. A long bull market still requires support from the fundamentals of the economy."

Renowned economist Pan Helin stated to Interface News, "On October 8th, the market opened high and closed low, with trading volume further increasing. It is expected that the first wave of the market trend is nearing its end, but the overall direction of the A-share bull market has not changed. For new investors entering the market, do not be impatient; wait for a pullback before participating."

"Investors in the Hong Kong stock market are relatively rational and less influenced by emotional factors. Moreover, there are certain thresholds for A-share investors to access the Hong Kong stock market. Although it is also a bull market, the trend will be slower, and it may even experience a short-term outflow of liquidity to the A-share market. The A-share market will rise and fall rapidly, but it is not certain that the trend has ended. It is estimated that the first wave of the market trend will reach a turning point this week, and the overall bullish trend of the large A-shares will not change," Pan Helin pointed out.

Shen Meng, Executive Director of Chanson Capital, noted, "The policies introduced by relevant departments before the holiday have created huge profit expectations for investors, which are more attractive than fixed-income products such as wealth management and certificates of deposit. Therefore, optimistic sentiment has dominated the portfolio adjustment behavior and has also supported the foundation for profit enhancement since the holiday. However, there are risks in the stock market, and the basis of the stock market is still the real economy. Overly optimistic sentiment may lead to potential significant risks."

Industry insiders have suggested that for individual investors with insufficient experience, it is necessary to adopt a long-term investment approach. They can also choose to entrust professional matters to professionals by purchasing well-regarded public mutual funds or by participating in the market through ETFs such as the CSI 300 or the SSE 50. This can help avoid investment mistakes.