1. How to objectively understand “boom investment”
(1) the level of prosperity determines the level of relative return – it is universal for global stock markets
In terms of the whole market, the rise and fall of one-year dimension depends on the growth rate of performance. Whether it is A-Shares in the past 30 years or U.S. stocks in the past 50 years, there is a linear positive correlation between the annual increase of the whole market and the growth rate of net profit in that year. In addition to A-Shares and US shares, we further traced the equity markets such as HK, TW, Japan, Germany, the UK and France, and the conclusions are generally the same.
(2) “growth rate” single factor is not omnipotent, but it represents the direction of high winning rate
In the single factor dimension, the monotonicity reflected in the data results more represents the probability of success of the single factor. For the deduction of non growth rate: the higher the growth rate, the greater the probability of outperforming the market median; In the first four groups, the difference in the probability of outperforming the market median is small, basically falling between 60% – 70%; For the latter three groups, the probability of outperforming the median market is less than 40%, and it is difficult to obtain excess returns.
2. Horizontal comparison of growth types – which type of growth does the market like?
(1) comparison of five growth types: [accelerated growth] ≈ [sustained high growth] ≈ [deceleration growth – low decline] > [dilemma reversal] > [deceleration growth – high decline] > [low speed stability].
① type of [accelerated growth]: whether it is accelerated by low speed or high speed (provided that the growth rate is > 30%), it has little difference from the type of [sustained high growth] (growth rate > 30%).
② type of [deceleration growth]: if the growth rate decreases little (no more than 50%, and the absolute growth rate is still more than 30%), the increase is not distinguished from the first two categories. If the growth rate decreases too much (more than 50%), the performance is average.
③ type of “dilemma reversal”: whether there is excess return depends on the degree of dilemma reversal.
④ type of [low-speed stability]: the performance of these types of assets is at the bottom, and the type of [20% ~ 30%] growth rate will be relatively prominent in the environment of weak overall market profit, such as 13 years, 18 years and 20 years.
(2) what kind of deceleration growth performance is still outstanding: [> 30%] & [> – 50%]
The historical regularity analysis shows that when we choose the target with high growth but the growth rate drops from the high level, we can refer to the index: the absolute growth rate of that year is more than 30% and the growth rate decline is no more than 50%.
According to this idea (the growth rate is more than 30% and the growth rate decline is not more than 50%), the current industry level can pay attention to: smart cars, auto parts, vehicle manufacturers, inverters, photovoltaic modules, new energy vehicles – equipment, 5g hardware, industrial Internet, cloud computing, information security, financial it, medical informatization, testing, architectural design, home furniture, breeding, hotels and catering Airport, duty-free, etc.
(3) pit climbing mode of dilemma reversal: at least recover [70%]; Profit recovery degree = the third year / the first year ① the increase of the current year is positively correlated with the degree of profit recovery; ② Only when the profit recovery degree is more than 120%, can we obtain relatively good income; ③ The bottom line requires that the degree of profit recovery should not be less than 70%, otherwise the yield will decline significantly. At present, the industries that can be concerned about the dilemma reversal are (according to the consensus expectation of the latest wind, there may be adjustments in the future): department stores, roads, tax exemption, information security, tourism, wine and catering, airports, railways, thermal power, express delivery, etc.
\u3000\u30003. Resumption of science and technology track: “30%” and business inflection point
From the two examples of PCB and TWS, we can see that the two values of “30%” and “- 50%” have good guiding value for judging the inflection point of the sector boom trend. When the profit growth rate drops from a high level and gradually approaches the growth rate of 30%, the fluctuation of stock price enlarges and even begins to adjust to a certain extent; When the profit growth rate drops below 30% or decreases by more than 50%, the boom will peak and enter the double kill stage of profit valuation.
Risk tips: macroeconomic risk, epidemic risk outside China, risk of performance falling short of expectations, etc.
