Dr. Lan: Another stimulus will support the Hong Kong equity/China ADR wave for a longer period

Big international banks began to act one by one, shouting to buy/long China. The Hong Kong stock market has recently surged, and so has the renminbi.

When the market is good, everyone is happy, but the happier you are, the more likely things are to happen.
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Data in the trading view

Before answering this question, I think it is necessary to consider the following two questions, which one is more important to investment behavior:

A: Understand the current state of the market;

B: Predict what state the market will be in;

People who invest in stocks prefer to be forward-looking, so B is that predicting the market is more important in investing.

Theoretically, the same is true; after all, stock prices are a discount on future cash flow. But if you do a backtest, you'll find that the money you lose the most is often on the left. The core reason is that you don't understand the current state of the market. Buying when you shouldn't have bottomed out and always looking forward to some good news is an easy mistake for institutions and individuals alike.

Instead of looking ahead every day, it's better to understand the current situation. Don't want to copy at the bottom, as long as you're on the right trend when buying at the bottom. So I personally think A is much more important than B.

So what is the current state of Dragon China?
In the second waveThe seller that started shouting that they wanted to turn around was an international investment bank. Now that they have begun to act, it is estimated that their shouting will get louder and louder.

However, it will take time for international buyers to enter, so the voices of international investment banks will be getting louder and louder. Precisely because domestic buyers are slowly changing their mentality, this market will continue to gain momentum.

Some people boldly prophesy the ark $ARK Innovation ETF(ARKK.US)$ The fund will also gradually expand the proportion of Chinese concept stocks.

The 10th IRD Seller WaveChinese brokerage firms have yet to start calling for a shift, but they will follow suit.