“Less than 40, do not understand value” should be more behind the change of life’s concept of wealth. At present, the market transaction is shrinking and the fund sales are not smooth. I’m afraid the three-year expansion is facing a liquidation. When people are in the Jianghu, some things always have to be paid back. The A-shares that have passed through and stand will also face some transformation.
Since the year of the tiger, market caution has gradually risen, and many uncertainties are slowly exposed. From the collective optimism years ago to the cautious pessimism now, investors are still so fickle in front of the trend.
From growth to value, from new energy to steady growth, policies and seller’s reports constantly send signals of style change to the market, but the market does not seem to buy it. Behind it is the difficulty of institutional thinking and internal structure adjustment.
In recent years, I have had a lot of contact with some public and private fund managers. The basic stereotyped view is to find the best quality enterprises and give them the highest valuation. The word “cost performance” seems to be in a lower position in their investment philosophy. In the past few years, a large number of fund managers with science background have been interested in technology, information The excavation of new energy also highlights their preference for growth.
I remember watching a video of Charlie Munger’s speech many years ago. When talking about value investment, there is a sentence “less than 40, don’t understand value”, which is still fresh in my memory. Slowly become rich and wait for the value to be discovered by the market. No matter what track industry, from bottom to top, look for those enterprises with cost performance, hold it patiently, and make time a friend of value discovery. Such investment mentality and path are really incompatible with fund managers who face ranking pressure and focus on scale, What’s more, most of our fund managers are in their infancy.
In fact, the pursuit of growth and adhering to value are more different from the investment philosophy and return objectives. The pursuit of growth means that they want to obtain the excess return of the market and are willing to bear higher volatility. These people are generally unwilling to meet the annual return of about 10%, so they take the initiative to improve their return through trading and chasing up and down; Those who insist on value believe in the charm of time, enter the market with the mentality of investing in enterprises, and obtain a return close to the enterprise roe. 10% is a satisfactory return. Their different needs for risk return lead to different perceptions of the market and investment.
The former seems to be more like in the start-up period, willing to take risks and pursue high returns, while the latter is obviously more like financial management, stable and unwilling to bear tossing risks. Behind the “less than 40, do not understand value” should be more the transformation of life’s concept of wealth. Since the A-share market has been more than 30 years, many old investors have already gone to Huajia. At this time, most of our basic people are middle-aged and elderly people who are not confused, while the fund managers are young and energetic and enter the market in a stand-by manner. Behind it are the capital demands that do not want to pursue risk, How can the two match? It is inevitable to complain, and after two or three years of running in, it seems that the year of the tiger has come to a crossroads.
At present, the market transaction is shrinking and the fund sales are not smooth. I’m afraid the expansion in three years is facing a liquidation. People in the Jianghu always have to pay back some things, and the A-shares that have passed through are about to face some transformation.
(the author is the director of Guotai Junan Securities Co.Ltd(601211) Shanghai Research)
