The Bull Market In The US Stock Market Has Lasted For 8 Years, Only A Shares Remain Weak.

A shares are overvalued and the five stocks have been down for almost two years. Investors who embrace the black five have fallen to the bottom. However, at the recently held shareholders' meeting of the Buffett, faced with more than 3000 pilgrims from China, when talking about the investment value of A shares, stock market partner Meng Munger said that China's stock market is much better now. shares Cheaper than the US, it is a good investment target. However, unlike the idea of value investing advocated by Americans, the speculative nature of Chinese investors makes the market full of casino characteristics and full of risks. In the long run, China's stock market is full of opportunities and bright prospects, but the process of growth is bound to be full of worries and costs.

After the big fall, are A shares expensive or not? How will the future market develop? Is the value investment in China unacclimatized? This is an important problem perplexing investors nowadays. Fear and greed are human nature. Value investing itself is the overcoming and correction of human weakness, and is destined to belong to only a few people. Even in the US, value investors are only a minority, not the vast majority. In fact, if most people are value investors, the trend and pattern of the market will undergo significant changes. Buffett will not be able to stand out. It is precisely because the value investment is so difficult that Buffett is so great and valuable.

A shares are expensive or not? The bull market in the US stock market has been going on for 8 years, and it is still making a new record in the past. Hong Kong stocks have gone up like a rainbow this year, which has reached a new high of 21 months. Only A shares remain weak, easy to fall, difficult to rise, and even create a record of 19 consecutive days of low opening. Fundamentally speaking, the different conditions of market valuation determine the different directions of market trend. At present, S & P 500 has a median of 20 times PE (P / E) and 3.12 times of PB (city net rate). The median PE of the Hang Seng index is 12 times, PB1.1 times; the median PE of the entire Hong Kong stock is lower, only 8.7 times, PB1.23 times. Relatively speaking, Hong Kong stocks are valuation depressions all over the world. This is also an important reason why I am optimistic about Hong Kong stocks.

Compared with Hong Kong stocks and US stocks, A shares The overall valuation is still high. At present, the PE median of A shares is 46 times, PB3.64 times. The valuation of Shanghai 50 is relatively low, PE median is 18 times, PB1.5 times. Generally speaking, A shares still have a certain bubble and are still in the stage of overestimating stock bubbles. It is particularly important to note that due to structural problems, the five types of stocks that are overestimated still have higher investment risks. Is value investing in China unacceptable? Pessimistic process still breeds hope. China's version 50, represented by blue chips, has opened up a "beautiful bull" market in the past year, amid the sluggish market environment. A large number of outstanding performance of the industry leader, the stock price has gone against the tide, hit a record high.

Although the A shares are more expensive than the US stock market, some of the representative Blue-chip company of the beautiful bull market have a great advantage over the US stock market. Their value has been reflected in the recent year's market. The value of A shares has also been affirmed by Buffett and Munger. From this perspective, value investing is still applicable in the A share market. Adhering to the concept and operation mode of value investment is still an important guarantee for good returns in the long run. And, with market environment With the change of market situation and the structure of investors, the concept of value investing is gaining recognition from more and more people.

Where is the future of A shares? At present, the rate of securitisation of A shares (stock market capitalization and GDP ratio) is only 74.9%, and the securitisation rate of US stocks has reached 138%. From the perspective of the development prospect of the securities market, the potential of A shares is indeed larger than that of US stocks. More importantly, the US stock market is already a global market and an important channel for global capital allocation. A shares remain relatively closed. With the gradual internationalization of A shares and the increasing demand for A shares from peripheral capital, the future growth of China's stock market is undoubtedly enormous.

Judging from the recent market, after nearly 300 sharp falls, the short-term risk has been fully released. Last week, the market main force launched a Jedi counterattack, which is likely to succeed in building the bottom. At the same time, the capital environment is gradually improving. With the rapid rebound of the Treasury bond futures, the risk-free interest rate has been greatly relieved, and the MSCI and bonds are approaching, the regulators' care for the market and the succor of the main funds continue to save the market, which provides a sufficient capital base for the continuation of the A bull market. We need to see risks in fanaticism, and we should see opportunities in pessimism. The beautiful bull underestimating blue chips in A shares will attract worldwide attention.

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