Chapter 96: If you can’t beat them, you can join them
Yao Jiu took the steering wheel and drove the car steadily onto the North Second Ring Road Overpass. The vehicles gradually became fewer and fewer. He slowly increased the speed and started talking.
"Brother Feng, how are the stocks doing lately? Did you suffer any losses from the stock market crash?"
"Luckily, I didn't buy it after the 5,000-point mark came out," Li Feng asked, gazing at the tall buildings on both sides of the viaduct. "How are you doing? Are you still investing in stocks?"
"Me? Hehe—" Yao Jiu laughed proudly a few times and whispered, "Brother Feng, these past few months, I've been taking advantage of P2P. It's so cool. There's no risk at all, and the returns are amazing. I've made back all the money I lost in the stock market."
"This allows me to eat and sleep well. I don't plan to trade stocks anymore. I'll just work during the day and do this at night. I've finally figured it out. Trading stocks is too stressful and not suitable for me. I'd rather stick with this low-risk investment. I don't have to compete with the bankers or the main players anymore."
"If you can't beat them, you can join them." Li Feng smiled mysteriously.
Yao Jiu was a little confused and said, "Brother Feng, don't laugh at me. I only have a few tens of thousands of yuan. How can I cooperate with the main force and the banker? Not to mention that I can't contact them, even if I could, they wouldn't even look at me, so how can I join them?
Li Feng's expression turned serious as he said, "When I say join, I don't mean you should speculate in stocks. I mean investing in convertible bonds."
"Convertible bonds?" Yao Jiu hesitated for a moment and said, "I heard that convertible bonds are extremely risky. They can be traded T+0 on the same day. Many people have lost a lot of money."
"Speculation will certainly lead to losses. Theoretically, you can lose everything in one day," Li Feng analyzed.
"But we're talking about investment. Convertible bonds are simply the result of listed companies issuing bonds to raise funds. Listed companies certainly don't want to redeem them. They'll try every possible means—for example, releasing favorable news, lowering the conversion price, improving the company, and so on—to convert the bonds and default on their debts. And the market makers and major players who manipulate the stock have inextricable ties to the listed companies. So, aren't you joining in the fun? Your interests are aligned with theirs?"
"Also, you can analyze it. If you buy convertible bonds when the face value is below 100 yuan and hold them long-term, you'll generally get at least a 30% return. During this bull market, many convertible bonds have converted to shares. You can also adopt strategies like double-low and spread-out strategies to spread your risk. If you're interested, you can refer to the book 'Attack and Defense.'"
Yao Jiu had never heard of the strategies that Li Feng mentioned.
Even Lin Menghan frowned and couldn't help but ask:
"By issuing convertible bonds for financing, companies enjoy very low financing interest rates, while investors enjoy the growth of the underlying stock while also having the protection of a bond floor. So, who is footing the bill in this game?"
"It's impossible for everyone to make money and no one to lose money, right? That doesn't go against the grain. You said that the capital market is essentially a game of near-zero odds. For every gainer, there's a loser."
Li Feng heard this and sighed softly, saying: "The ones who buy the orders are naturally the shareholders."
The other three were speechless after hearing this.
Stock investors have become the final payers.
State-owned enterprises need shareholders to get out of trouble, technological innovation needs shareholders, and now convertible bond financing is paid for by shareholders. Investors rushed into the stock market with enthusiasm, but in the end most of them returned empty-handed and disappointed.
Who has ever considered the feelings of the stock investors? Who understands their sorrow and tears?
After a while, the North Second Ring Road Automobile Trade City came into view.
The trade city covers an area of hundreds of thousands of square meters, with imported, joint venture, wholly-owned and domestic 4S stores standing next to each other.
Yao Jiu made a phone call and Mr. Hong from the Trade City drove over to meet him.
"Hey, Reporter Yao, long time no see—" Hong Tao extended his hand and shook hands with Yao Jiu, then asked, "Who are these people?"
"Oh, they're all friends. This is Reporter Li from City B's Metropolitan Newspaper, and these two are editors from our TV station. They're all family."
Upon hearing this, Hong Tao didn't dare to be disrespectful and said quickly, "Reporters, what car do you want to buy? Just tell me, and I'll definitely give you the price."
Yao Jiu glanced at Li Feng, and Li Feng smiled and said, "If you want to support domestic products, buy Great Wall Motors."
"Let's go." Mr. Hong led the way, and several people followed in their cars. Soon they stopped in front of the Great Wall Motors 4S store.
A beautiful car sales consultant, with a sweet smile, came over, exchanged a few pleasantries with Mr. Hong, and then took a few people to look at cars.
The decoration of Great Wall Motor's 4S store is magnificent and the designs of several SUVs are also very domineering. After taking a quick look at the price and performance, Li Feng directly ordered a Great Wall SUV, H6, for 130,000 yuan, which comes with leather seats and reversing image, and he can pick up the car in about a month.
Sitting in the back seat, Zhao Xinyue felt the spaciousness of the car and the open field of vision, and praised it highly. After a test drive, Lin Menghan also had a greatly changed impression of domestic cars.
Over the weekend, another wave of good news came.
Nearly 900 central and local state-owned enterprises announced an increase in their holdings, and there were reports that up to 1.5 trillion yuan had been mobilized to rescue the market.
Monday, July 13, 2015.
The Shanghai Composite Index opened at 3918 points, fluctuated intraday, broke through 4000 points, and finally closed at 3970 points, with a trading volume of 782.4 billion yuan.
The ChiNext Index showed strong momentum, opening at 2612 points, up 3.01%, and then continued its upward trend, soaring to 5.15% in the afternoon and continuing its upward trend, ultimately closing up 5.8% with a trading volume of 54.5 billion. Almost all ChiNext stocks hit their daily limit.
On that day, more than 100 stocks resumed trading, and one of them hit the daily limit. Even many GEM stocks hit the daily limit for two or three consecutive days.
The most violent initial bear market decline is over.
In a flash, more than a month has passed, and the Shanghai Composite Index seems to have stabilized, fluctuating around 3900 points, with small fluctuations.
Monday, August 17, 2015.
Early in the morning, Li Feng picked up the car from the 4S dealership and registered the license plate. Just as he was driving out of the vehicle management office, a phone call came in.
Zhao Xinyue, who was sitting in the passenger seat, helped to answer the call and pressed the hands-free button.
Li Feng glanced at the incoming call, his face lit up with joy, and said, "Dad, where are you? I'll drive to pick you up. I just picked up a car."
"Hey, you don't have to answer. I'm already at the door," Li Youjiang said with a smile, carrying a snakeskin bag and a paint bucket, his phone tucked under his left chin. "When will you be home?"
"I'll go back right away. It will take me two hours, um, three hours to get home." Li Feng replied.
"It's already afternoon in three hours. Did you ask your mother to save some food for you? What do you want to eat? I'll ask her to save some for you..." Li Youjiang asked.
"No, I'll just eat something casually. I've prepared the money, so you don't have to worry about it." Li Feng replied.
"Oh, okay, I'll hang up first."
Li Youjiang walked a few more steps and stopped in front of the old house. He put down the paint bucket and snakeskin bag, reached out his hand to knock on the door, and while knocking, he shouted: "Xiu Rong, Xiu Rong - open the door, open the door -"
The sound was so loud that it could be heard by all the neighbors.
"Who's knocking on the door? Why does it sound so familiar?" Li Youquan, who lived next door, put down the mahjong tiles in his hand, walked out of the house, climbed up the ladder and looked, and it turned out to be Li Youjiang who came back.
He looked at the snakeskin bag beside Li Youjiang, his eyes suddenly gleaming with gold, and thought to himself, "Brother has been away for three years, he must have made a lot of money and brought it back."
"NND, you humiliated me that day, so don't even think about having an easy time today."
Li Youquan thought this as he climbed down the ladder, returned to the house, and shouted to a young man playing mahjong, "Goudanzi, hurry up, go tell Ergouzi, Uncle Zhang from Old Wang's family, and... tell them that Li Youjiang is back with the money, saying he wants to pay off his debt. Hurry and bring the IOU!"
"The money isn't much. If you come too late, you won't be able to get it. You'll have to wait a few more years!"
"Really?!" Gou Danzi threw down his mahjong and said, "He still owes my family 2,000 yuan... I'll go and tell them right away..."
Goudanzi ran out of the door, and Li Youquan picked up his phone again and started making a call.
After a while, a large crowd of more than a dozen people rushed into Li Youjiang's old house.
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