Some time ago, as a private equity manager, I accepted the invitation of the private placement network and did an interview. The interview mentioned some questions about value investing, quantification, valuation, technology trading, stock selection, risk control, and optimistic directions.
I've picked out some of the key points to share with you. There is a lot of content, so let's sort out the first half today. Liu Yansong:Let's start with the understanding of the word quantification. Many people think that quantification is trading in a computer way, which is often the understanding of the market.
I think all successful investors are quantitative, it's just that some people quantify with computers, some use their brains to quantify, and then trade manually. I think quantification is nothing more than two points: first, it is more reasonable and refined in historical backtesting, which can avoid the subjectivity of human brain backtesting;Second, in the current implementation, we can solve some human problems and avoid the situation of whether to cut or not to buy.
All successful traders, computer or not, do so quantitatively. Whether it is in any international or domestic market, he has his own set of ideas in his head, and he implements them firmly according to his reasonable ideas. These successful investors have this in common.
We used to do stock indexes, and technology trading is not like value investment, value investment does have real ** and value in it. Technical trading is a game of probability and odds. We do the best quantitative trading, which is to use a quantitative and computer execution method.
Now we have changed from quantitative trading to value investment, in fact, the word "quantitative" has not changed, and we are now doing value investment in quantification.
For example, there are 5,000 ** stocks in the market, and after I eliminate the problem stocks through some risk indicators, there are 500 left;According to the competitiveness of the enterprise in the industry, I will exclude 300 and leave 200;According to the company's profits, these 200 are divided into three types: the first is the value stocks whose profits do not grow much, which may earn 1 billion this year, 1 billion next year, and 1 billion the year after tomorrow;The second is growth stocks with continuous profit growth, which may earn 1 billion this year, 1.2 billion next year, and 1.5 billion the year after;The third is cyclical stocks whose profits fluctuate in cycles, and the company may earn 200 million this year, 200 million the year after, 200 million next year, 1 billion in the next year, 500 million in the next year, and then back to 200 million. Of the three types, I continue to subdivide each of them. Actually, this is quantification.
According to everyone's traditional understanding, you may think that buying and selling short stock indices is called quantification, and pure doing is not called quantification. But I'm buying long**, short selling**, isn't this also a hedge?So at that time, our quantitative hedging was different from the quantitative hedging that many people understood. Nowadays, the quantification that is often understood by ** companies are those who do t and intraday ** trading. This definition is also unreasonable.
But in essence, we are now doing ** value investment, but also according to the previous layer of logic to choose**, which can also be defined as quantitative, but it may not be the same as the way of thinking recognized by the outside world. Liu Yansong:No, we invest primarily in growth, followed by cycle and value.
Like Industrial and Commercial Bank of China, Daqin Railway, and Yangtze River Electric Power, the profits of these enterprises often do not change much, and they belong to value-oriented companies.
Like Moutai, Yili, and Gree, the profits of these companies are growing every year, and they often belong to growth companies, and their profits and stock prices have risen relatively largely. In fact, looking back on history, the same is true of these ** that have risen the most in the past two or three decades. So growth companies are our first main investment.
Cyclical companies are characterized by a spike in profits when the cycle comes. For example, brokerages are cyclical companies, and when a bull market comes, brokerages are often the first to benefit. If you can catch this cycle, you may make money quickly, but this cycle may not come once in 10 or 8 years, so you have to grasp the time, if you catch it wrong, you may buy it and it will be **.
In the long run, the rise of cyclical ** is not large, so investing in cyclical stocks must passively wait for the opportunity. It may take 3 or 5 years to wait for a certain opportunity, and after finding the opportunity, we may enter a twenty or thirty percent **, that's all, most of the time we still buy growth stocks.
One of the key issues to pay attention to when investing in growth stocks is valuation. For example, in the first two years, whether it was liquor or medicine, etc., those companies with good performance were speculated. Many companies are only worth twenty or thirty times the P/E, but they have been speculated to hundreds of times P/E. In this case, I would definitely rather buy ICBC than buy them, because the risk is too high, and the value of ** has far exceeded its value.
When buying a growth company, the valuation should at least be reasonable. For example, Kweichow Moutai, looking at the historical P/E ratio, you can see that its average P/E ratio is 20 times. If it is speculated to a price-to-earnings ratio of more than 60 times, it is unreasonable to increase its performance. It is a liquor company, it is impossible to double the profit every year, the normal profit growth rate should be between 15%-25%, to give a times of the price-earnings ratio, it is certainly unreasonable;Another example is how a company that sells soy sauce can be worth 100 times the price-earnings ratio;Ophthalmology, dental hospitals, etc., how can it be worth 200 times the P/E ratio.
Although the company's performance is growing, its valuation is high, so we don't choose it. If its performance is growing, and the valuation is still at a reasonable level of twenty or thirty times, this is our first choice. Liu Yansong:I just talked about these three major types, and each of them has a different way of valuation.
Value-based companies, profits do not grow much, such as Daqin Railway, public utilities highways, banks, these have little room for performance growth, the generally reasonable price-earnings ratio should be 10 times, below 10 times can be bought, more than 10 times I will not buy. For example, banks are now at a 5 times P/E ratio, which is relatively low, and if it is a 15 times P/E ratio, I will definitely not buy it.
Corporate profits do not grow much, 10 times the price-earnings ratio, the average annual income is about 10%. If the company's net worth and other aspects are a little higher, it may rise a little more, at most 12%-15%, and it is impossible to rise too much.
If it is a growth company, generally growing by 20% per year, then matching the price-earnings ratio of twenty or thirty times is about the same.
If it's a cyclical company, it's hard to calculate. Generally, we do not recommend others to speculate in cyclical stocks, and we will not touch them easily.
Generally looking at cyclical stocks, you have to ** what is the highest point of profit when the cycle comes, how much money can it make, and how long can it reach?At this time, give it a 7 times P/E ratio, and then calculate the room for profit.
Suppose a mining company is cyclical, you expect its best performance may be two years later, it is possible to make 10 billion a year, give it 7 times the price-earnings ratio, then the market value is 70 billion. If its market value is 20 billion now, 2 years later, the market value will rise from 20 billion to 70 billion, that is, it may earn 25 times the profit margin, just work backwards. Liu Yansong:I don't do it. In fact, it is not right to do ** in the way of technical trading. Technical trading must be traded**, not traded**.
* There is a limited amount, and when someone catches a certain amount, he can manipulate the stock price. For example, if a company has 100 million shares and someone takes 30 million shares, then he can basically control this **. After the dealer is absolutely in control, the ** picture is left to him to draw.
*The market is different, and no one can always control the market. It can have 100 million, it can have 10 billion, it can have 100 billion. Once you're not going in the right direction, someone will be infinitely against you.
In contrast, the market is far more indicative of a person's skill level than the market, and if you have the ability to trade technically, you should do it. The market is leveraged, and it can be seen more clearly. Doing technical trading in the ** market, the starting point of this practice itself is not right, the direction is not right, and it also means that the ability is not strong enough.
In addition, **unlike stock indexes**, there are too many intermediate friction costs. Stock index**, you can place it casually, and the opponent's spread is only 02 points. The next order represents 1 million, and if there are 10 lots on the opposite side, you can place 10 orders and 10 million, which is a minimum fluctuation unit.
But an ordinary **, you can't put 10 million into it when you have the smallest fluctuation unit of a penny. Normally, if you add 10 million to it, it will pull it up by 05%, if you place an order quickly, there is no such large volume in the market. So to do automated trading, you have to do something tiny. For example, 5 million under a **, a fund of 100 million, to make 20 **, each 5 million. When the opportunity comes, you will place 5 million, so this thing is also very troublesome.
In addition, the valuation of the entire ticket market is very low now, and it is not cost-effective to do any speculative behavior at this time. There is only one way to be right, that is, to find opportunities for value investment, seize and cover at a low level, which is the best way to invest. Of course, this is for the moment, not all the time.
Liu Yansong:No, and we're extremely opposed to this thing. This kind of is to be clever, although it is possible to make a small amount of money, but as soon as you suffer a loss, you will suffer a big loss.
For example, if you are optimistic about a **, you plan to hold it for a long time. During this period, there may be a month or two of ** rapid fluctuations, you feel that it has risen high, you want to sell it first, and then suck it back after it falls back in these two months.
There's a question here, what do you expect from it now?You expect it to fall, but when you bought it before, your goal was to hope it went up. That is, your long-term direction is to think that it will go up, but in the middle of these 3 months, your idea is to hope that it will fall. For the same target, long-term bullish, short-term bearish, then you yourself will definitely be messed up, and your confidence will not be stable enough.
If you were optimistic about a very good **, it could continue to rise 10 times or 8 times, but you couldn't hold it in the process of throwing high and sucking low, and you might earn dozens of points and run away. Then you have made a small amount of money and suffered a big loss.
Why don't you do a high throw and a low suck?Those who sell high and buy low are those who can't make big investments and make big money, and they may not even be able to make small money. Because you have two ideas on the same thing, it's very difficult for you to make it clear.
And if you think about it, often a ** rises very well, you throw it at a high position, and you don't suck it back, then you won't chase it when it goes to **. To put it bluntly, if you sell high and buy low, the money you can make may be this 15%, and if it doesn't give you another chance** and keeps going up, you may miss out on twice the gain. This is the matter of making small money and losing big money, and it is not cost-effective.