You only see my short-term windfall profits but not how much I have paid for it.


#币安Alpha上新

In many people's eyes, the recent A-shares are indeed the domain of speculators and 'death squads.'

There is no highest, only higher! Sanyangma, Jiuzan Medical, Lanke High-tech, Chalco International, Caixin Development, Shaanxi Jinye, Meisheng Culture, Fengfan Shares, Zhongrui Shares, Furan De, Yueling Shares, Beijing City Shares, Qiming Information, Zhenyang Development...

'Bull stocks' and 'monster stocks' rise and fall in succession with huge short-term gains, gathering market popularity and attracting countless retail investors' eager attention.

Recently, Yinshi Finance contacted a top speculator from South China, Liao (alias), for an in-depth exchange. Liao shared his views on the market, leading stocks, monster stocks, the ultra-short ecology, and some of his operating models and insights with the reporter. With his consent, the reporter compiled parts of the exchange content for readers' reference only. (Note: The concepts and models described by Liao are his personal views and do not represent the views of this organization; investors operate at their own risk.)

Yinshi Finance: Recently, there are many 'monster stocks' in the market. I heard Liao has made a lot of money, but many investors are still suffering losses. As one of the top speculators in the market, how do you view this operating model of speculators?

Liao: The A-share market has given birth to many investment concepts and operating models over the years, including short-term, quantitative, value investing, etc. Existence is reasonable. Each person's view of the stock market relates to their character, education, career experience, life experiences, capital size and nature, values, etc. No operational model is inherently good or bad. I do not evaluate others' concepts, as long as they do not involve insider trading or illegal behavior.

Specifically returning to the speculator model. Generally, the narrowly defined speculators are those who do ultra-short-term trading, most of whom are next-day traders. The buying and selling methods include low absorption, ignition, hitting the board, etc. Most of the top speculators in the market started by hitting the board, typically like Zhang Jianping, Zhao Laoge, etc. Those who use low absorption include 'Qiao Bangzhu' and others. However, aside from the board hitting model, not many can grow large.

The difference between A-shares and other markets lies in the limit-up system and T+1; this is the fundamental reason for the existence of 'death squads.'

Yinshi Finance: Many people do not understand why one can buy stocks during the day, but why must one buy at the limit up?

Liao: I believe there are roughly two reasons for hitting the limit up. First, buying at the limit up is the most certain. When a stock is up seven or eight points, would you dare to buy? What if it falls back? I don't know how a stock will perform in a few days, but if it hits the limit up today, I have a good idea of how it will perform tomorrow.

Secondly, aside from large-cap blue chips, almost all 'bull stocks' and 'monster stocks' in A-shares have limit up during the main rising wave, making it easy to catch these bull stocks when hitting the limit.

Yinshi Finance: Isn't it possible to incur losses if the limit up does not hold on that day?

Liao: This relies on understanding the market and individual stocks. Different people hitting the board may have significant profits or losses, depending on their win rates.

Yinshi Finance: The market is good recently, and many can make money by hitting the board. How will this model perform when the market is bad?

Liao: When the market is bad, being in cash or light positions will solve all worries. Those who do not understand how to rest do not understand how to invest. Usually, I will use part of my position to continuously buy and trial-and-error; if the next day meets expectations, I will hold on, continuing this operation until I encounter a big bull stock, then I will eat a wave fiercely. In short-term trading, the real big money comes from the few leading stocks that appear in that month or a few months. In my view, a true expert's net worth curve should be characterized by large rises, small pullbacks, and continuous new highs.

Yinshi Finance: With the full implementation of the registration system in the future, all will be 20CM, will the board hitting model disappear?

Liao: Speculation is as old as time. There is a saying on Wall Street that 'money never sleeps.' Even if the entire market goes to 20CM in the future, speculators will still come up with new ways to play. Look at the performance of some stocks on the ChiNext this year; the profit effect is also very strong. I believe that A-shares' biggest advantage compared to other markets is the large number of retail investors and good liquidity, making it easy to make money.

Yinshi Finance: What categories of people generally operate in the limit-up area?

Liao: Among the group hitting boards, there are many factions based on buying positions. Some prefer to hit the first board, some the second or third, and some like to hit high boards. Generally, the first board does not reveal the leading stock, but some can still make money; that's because they picked the right stocks. Those who hit high boards are 'born of the dragon, die by the dragon,' typically like the previous Shenzhen Happy Coast seat of Zhongtai Securities, which has high certainty but also greater risk. Many people say, 'If I have to die, I want to die on the leading stock.'

However, most speculators tend to operate on the second and third boards more, such as 'Zhao Laoge,' who has said that the second board determines the leading stock. Many speculators are ultra-short-term traders, and if the stock they bought does not quickly hit the limit up the next morning, they will take profits or stop losses. Sometimes they will also lock in positions. Fang Xinxia's frequent entries and exits on the Provincial Advertising Group is the best case study of the speculator's operating model; you can study it carefully.

Yinshi Finance: You have been doing this for many years and have been quite successful overall. Is there any secret to hitting the board, or what common characteristics do short-term bull stocks have?

Liao: In recent years, a large number of typical leading stocks have emerged in A-shares history, such as Guizhou Gas, Everbright Securities, Jinli Permanent Magnet, Saturday, Shunkong Development, Mantuo, Wangfujing, Dongfang Communication, Daon Shares, etc. You will find that they all have very strong common patterns.

First, they are basically all in the main rising wave. Stocks with smaller market caps may 'take off' suddenly, but larger stocks generally have a longer accumulation period with smaller fluctuations, some even having previously hit the limit up. The core idea of speculators is to 'borrow momentum'; 'those who follow the trend thrive, while those who go against it perish,' even early Xu Xiang used to hit boards by borrowing momentum. Very few do well by trying to catch bottoms or counter trends.

From the candlestick patterns, recently stocks that 'trap people' have unclear directions and trends, with chaotic candlestick movements. When stocks are in medium to high positions and oscillate too much for too long, after just passing a sharp drop recently, or after a long period of gradual declines, or having 'monster' performances in the past year or two, such stocks are unlikely to go far, and I will mostly exclude them.

Yinshi Finance: So what kind of stocks are likely to become 'monsters'?

Liao: I categorize short-term bull stocks into large-cap leading stocks and small-cap leading stocks. Large-cap leading stocks refer to those with larger market caps and trading volumes, rising with great momentum, like the previous Junzheng Group. There are not many such stocks, but once encountered, they can be targeted for heavy positions. Small-cap leading stocks are more speculative in nature and may have huge profits, but if the buy-sell points are not well executed, the drawdowns can also be significant. However, the two models are not static; a small-cap leading stock may become a large-cap leading stock in the later stages or the second wave.

In summary, recently rising stocks generally have moderate to small market caps, low prices, few institutional shareholders, smooth candlestick patterns, and align with current thematic hotspots. Additionally, their previous limit ups are usually very strong. From the perspective of sentiment flow, they generally first move in unison, then diverge, followed by a rapid consensus and decline, and there may even be a 'second spring' revival.

Yinshi Finance: From the market and intraday charts, what are the characteristics of 'bull stocks'?

Liao: 'Bull stocks' are also traded out. I believe that stocks that hit the limit up every day are meaningless; only with turnover can there be 'bull stocks.' The essence of short-term limit-up stocks is created by players with different positional preferences continuously relaying. Some stocks that have a few consecutive limit ups, then open up and have sufficient turnover, can also potentially rally.

From the market perspective, I am generally cautious about stocks with very low trading volumes, stocks whose intraday charts are too steep, and those that are hesitant when hitting the board. Large funds aggressively grabbing shares on the limit up is the best quantitative representation of popularity.

Yinshi Finance: You usually finish trading by the morning, right?

Liao: Most selling is resolved in the morning, and buying is basically done in the morning; I rarely do end-of-day trades, but if it's a leading stock, I will also hit the board at the end of the day.

Yinshi Finance: Have you participated in the recent monster stock Sanyangma?

Liao: I bought some of this stock, not much of a position. Recently, I caught the main rising waves of Jiuzan Medical, Shaanxi Jinye, and Beijing City Shares. Newly listed stocks typically behave like 'monsters' that tend to take off after the first limit up, but the speculation on new stocks is too high, and the turnover rate is too large, making it very likely to be 'one thought in heaven, one thought in hell.'

Yinshi Finance: What is your view on the role of the dragon and tiger list?

Liao: This needs to be viewed dialectically. It is not possible to operate entirely according to the direction of the dragon and tiger list, but one can learn some high-level speculator operating models through the dragon and tiger lists of some 'bull stocks.'

Yinshi Finance: To do well in stocks, you need to learn a lot of knowledge. Today, let’s not discuss fundamentals and other aspects; from a technical perspective, which indicators do you focus on researching?

Liao: It doesn't need to be too complicated. Candlestick patterns, moving averages, turnover rates, trading volumes, MACD, and intraday charts are enough.

Yinshi Finance: Hitting the board well may indeed yield huge profits, but why are there so few quantitative institutions that can excel in this area?

Liao: Hitting the board is somewhat semi-quantitative; it is not difficult, but truly doing it well is very challenging. This is because each stock's candlestick patterns are intricate, and intraday charts are ever-changing, like when to hit the board, reverse, seal the return, and when to start; every stock is different, making it nearly impossible to measure and refine using indicators. Currently, only a very small number of quantitative funds operate in the limit-up area.

Yinshi Finance: There are many young investors in A-shares who want to take the investment path. What do you think?

Liao: The road of investment is very difficult. If you really want to invest, those with good education should try to gain experience step by step in formal financial institutions. As for my short-term model, I do not recommend it for ordinary young people. You only see my short-term windfall profits but not how much I have paid for it; I have rarely socialized over the years. Everyone wants to master the short-term trading (Kwaihua Baodian), but there is a saying, 'When one general succeeds, thousands of bones decay'; the effort put in here is not visible to others.

However, that said, if someone really wants to go this route, they can only find a stable profit model suitable for themselves in a shorter time and then refine this model to perfection, executing it mechanically. 'One trick will feed the world' is not without reason.



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