How Do Retail Investors Choose Stocks Through Turnover Rates?

Turnover rate refers to the ratio of the total number of shares traded to the current stock in a certain period of time.

The high turnover rate reflects the frequent entry and exit of funds.

If the turnover rate is high and the stock price rises, it shows that the desire to enter capital is stronger than the intention to withdraw. While the high turnover rate and the falling share price indicate that the desire to withdraw funds is stronger than the intention to enter.

The turnover rate can not only indicate the full extent of a stock exchange and the active status of the exchange and investment, but also an important reference index to judge and measure the differences between the two sides.

Low turnover indicates that the views of the two sides are basically the same, and the share price will generally fall slightly or enter a sidewalk arrangement because of the sluggish turnover.

The high turnover rate shows that the differences between the two sides are larger, but as long as the active trading situation can be maintained, the general stock price will show a slight upward trend.

The combination of turnover rate and stock price trend can make certain predictions and judgments for future stock prices.

The turnover rate of a stock suddenly rises and volume enlarges, which means that investors can buy large quantities and share prices may rise.

If a stock continues to rise for a period of time, the turnover rate is rising rapidly, which may mean that some profit makers must cash in and share prices may fall.

For the emergence of high turnover rate, investors should distinguish the relative position of high turnover rate.

If the previous stock is trading after a long time of slump, and the higher turnover rate can be maintained for a longer time, it can generally be seen as a more obvious sign of new capital intervention.

At this time, the reliability of high turnover is better.

Due to the bottom volume and the full turnover, the future growth of such stocks should be relatively large and the possibility of becoming strong stocks is also great.

Investors can focus on these stocks.

If a stock suddenly rises at a relative high level and the volume suddenly rises, it will be more likely to fall.

When investing in new shares, the turnover rate is also an important reference index. The high turnover rate on the first day of IPO means that the paction is more active, with the intervention of main funds, which means that the market will have a good performance.

If the turnover rate is low and the main funds are hard to gather chips, then the market will face a trend of oscillating and repeated weakness until the chips exchange process is completed.

The turnover rate can also reflect the trend of mainstream capital and the main battlefield of the market. For example, in December last year, the turnover rate of the top 50 stocks was basically the same as blue chips and oversold stocks.

The more advanced stocks, the more active they are.

The activity here implies double meanings, that is, stocks frequently appearing in recent gains or decreases.

At that time, the leading position in Shanghai, such as Meilin and Shenlong development, ranked the top.

Similarly, diving stocks such as bonded technology, Chang nine biochemistry are also among the top ranking of turnover rates.

In the continuous months of dynamic turnover statistics, basically the blue chips and the ultra low share average share, indicating that the market mainstream funds are mainly composed of blue chips and super stocks.