For the next stage of the market trend, we have the following specific views:
First, at the level of the micro trading structure, the market is speeding up the process of clearing pessimistic expectations and excessive pessimism. In terms of index performance, the Shanghai Composite Index and the heavyweight index have fallen quite significantly recently, and may have reached a relatively sufficient point in absolute terms. However, while the spatial correction seems to be in place, the length of the cycle required for the market to truly bottom out has not yet been met in the time dimension. As a result, we maintain our previous view that the market is likely to continue to consolidate and bottom out in March-April.
Second, due to the lack of a strong positive catalyst to trigger an upward revision of overall expectations, the mindset of market participants is generally fragile after a rapid **, and it will take time for confidence to rebuild. In this context, it is difficult for the market to form a strong consensus in the short term, and it is expected that the market will enter a long-term bottoming stage.
Third, in this process of grinding the bottom, it should be noted that the market bottoming out and the emergence of actual opportunities usually do not coincide quickly. This means that even if the market decline temporarily eases or touches a phased bottom, investors will need to wait patiently for further risk release, improved economic data, and clear policy signals to confirm a stronger reversal**.
Fourth, in the face of such a complex market environment, investors should continue to focus on reducing the overall volatility of their portfolios. ** stocks and high-dividend sectors still have a strong defensive advantage at this stage due to their relatively robust characteristics, while small-cap stocks may need more time for internal adjustment and risk digestion due to the instability of their trading structure.
Specific to the investment strategy, since the beginning of the year, some of the best growth stocks such as new energy, electronics, automobiles and pharmaceuticals and other high-quality targets in the industry have shown a certain degree of resistance in the market adjustment, investors can pay attention to the investment opportunities in these areas due to the market panic being wrongly killed.
At the same time, one of the best strategies at this stage is still to reduce portfolio volatility by allocating low-risk characteristic assets. It is recommended to build a bottom position with the core idea of "low valuation + high dividend", focusing on operators, highways, large state-owned commercial banks, petrochemicals, coal and other related industries in the resource industry.
In addition, in addition to high dividend yields, the target of "low valuation + stable cash flow" is also an important choice for investors to reduce volatility. Utilities and infrastructure-related sectors such as gas, electricity, water, solid waste and ports not only have low valuations, but also stable operating cash flows, which can provide a good cushion during market turbulence.
Note: The data and opinions in this article are provided by Guojun Strategy Team and are for reference only and do not constitute investment advice.
A shares