Chapter 339 Is the Market Efficient?

Friday, November 8, 2024.

Jisilu temperature: 24.47, Shanghai Composite Index: 3502.13 points.

People come and go in the market, scrambling to set a price for each target.

So, is the market efficient?

This needs to be viewed in both the short and long term.

In the short term, the market is inefficient and even irrational. It often goes crazy, and sometimes it can last for months or even years.

For example, the day before yesterday, Trump was elected and all commodities plummeted.

However, just one day later, these commodities skyrocketed again.

As an investor, you need to take advantage of this short-term market madness.

Buy when the market is wildly undervalued.

Sell ​​when the market is wildly overvalued.

In the long run, the market is efficient.

After several years, or even more than ten years of experience, the best targets will eventually emerge victorious.

Therefore, when we choose targets, we must choose excellent targets in order to ultimately win in this long-term race against time.

Instead, follow the market, go crazy with the market, and get lost in it.

Yesterday's news:

1. The Federal Reserve cut interest rates by 25 basis points.

The Federal Reserve cut interest rates by 25 basis points as expected, and various commodities wiped out the large negative lines drawn the day before overnight.

Like it never happened.

In the future, in this macro cycle of resonance between China and the United States, loosening monetary policy and lowering interest rates, commodities should perform well.

2. The replacement of 6 trillion yuan of local DF bonds will be arranged over three years.

As soon as the news came out, the RMB exchange rate and the FTSE 50 index fell.

Commodities also fell instantly.

Is it not as expected?

What are your expectations?

Ten trillion? Thirteen trillion?

In fact, this is quite in line with expectations. Overall, we should still "focus on stability" and release water steadily, rather than flooding the market with money.

In fact, those who wanted to make a quick buck by flooding the market with money and rescuing the market were disappointed.

In today's market, the Shanghai Composite Index opened high and closed low, falling -0.53% to close at 3452 points.

Anticipate your expectations.

The surge in the futures market last night did not cause any ripples in the stock market, but instead left many people hanging.

Previously strong stocks have experienced a strong pullback.

The market is full of twists and turns, and it is always unpredictable.

But, in the end, it will wind its way north and all the way up.

Trade your trades, plan your plans, and execute.

Shareholders exchange:

1. "The Little Dragon Who Likes Hiiragi Trees":

"How do I find out the bank's liability cost? I have been searching online for a long time but can't find it."

Look at the annual report, it’s in there.

This is very important. It is the bank's livelihood and core competitiveness.

Only when the liability cost is low can banks have the capital to compete for projects with very low loan prices, thereby obtaining an interest rate spread that is even higher than that of other banks.

However, it is very difficult to reduce the cost of debt.

2. "Username 9429806": "I'm feeling a bit down today and want to talk to you."

Very normal.

There are thousands of ways to make money in the stock market, and some people make a lot of money by hitting the limit.

Generally speaking, from a probability perspective, it is much easier to make money in a bull market than in a bear market due to the difference in liquidity.

However, if we narrow it down to a single stock,

Once the stock turns from bull to bear, the failure rate of hitting the limit will become higher.

Because you don’t know when the main capital inside will cause the stock to go bearish.

Playing this requires talent and luck.

If you think you have the ability, you can try it out.

If you try for a while and feel that it is not suitable, you can change another path.

It is recommended not to hang yourself on a tree.

There are many roads and life is long. You can explore as much as you can and eventually build your own operating system.

3. "Little King Duck":

"We need a slow bull market, but it feels like we're whipping a fast bull market now. Judging from the market trends from September to now, if this continues, the index will reach 10,000 points in less than a year. This is too unhealthy."

How could that be?

Market trends will surprise everyone.

There are also many crashes in the bull market.

From September onwards, there has not been a single market-wide sell-off.

In the future, there will definitely be one.

The fall has caused many people to suspect that the bull market is over.

4. "Chen Xiaotian": "Let's talk about other opportunities to get rich."

Once there is inflation in society, prices will rise, and due to the price difference, various arbitrage opportunities (deflation-inflation) will arise.

For business operations, the previous zero inventory and high turnover model will be transformed into a high inventory and stockpiling model.

For individuals, they will change from high savings and fear of risks to taking the initiative to invest, start businesses, and look for opportunities to get rich quickly.

In the stock market,

A few days ago, the price of new stocks soared more than ten times in one day. This is a liquidity premium opportunity in a bull market.

There will definitely be more arbitrage opportunities in the future, and we look forward to everyone’s discovery.

Today, there are a lot of things going on at home, so we just had a quick chat.

Let’s talk about it in detail when we have time next week.

If you have time, you can urge the next update or send a telegram.