Today, I will first answer a few questions from fans:
1. A fan asked: Why are you preparing to reduce your position in the insurance sector?
The insurance sector is an industry greatly influenced by the country's economic development, which means the overall performance growth of the insurance industry should be gradual. Especially in the current situation where financial innovation is extremely difficult, the development of the insurance industry is severely constrained by the level of residents' wealth growth, and the performance growth of the insurance industry cannot be achieved overnight.
From the perspective of performance growth driving stock price increases, the insurance sector has already risen significantly, and the current stock prices have basically reflected the true value of the insurance industry. It is obviously hoping for a low-probability event to expect the insurance industry's performance to continue to grow significantly in the next one or two years, and the stock price to continue to soar.
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Therefore, reducing the position in the insurance sector and using the obtained funds to add to other sectors that are undervalued by the market has become my current choice. Of course, my reduction may also be wrong.
2. A fan asked: Why are you not in a hurry to reduce your position in dividend funds?
Investing in dividend funds is actually investing in the stocks of high-dividend companies in various industries. Such companies are all white-horse blue-chip stocks in various industries, and the dividends are generous, all of which are suitable for long-term investment. Therefore, I am not in a hurry to reduce my position. Isn't getting dividends attractive?
According to statistics, in 2022, the total cash dividend of Shanghai-listed companies reached 1.72 trillion yuan, a year-on-year increase of over 12%. In recent years, the biggest progress in A-shares is that the number of companies paying dividends has increased significantly, and the proportion of dividends has also increased significantly.
A friend asked me: "If you buy five or six bank stocks with a dividend rate of more than 7% for 1 million yuan, and receive a dividend of 60,000 to 70,000 yuan per year. The annual dividend income you get in your hand is higher than the annual income of ordinary workers in many fourth and fifth-tier cities, is that right?"
I replied: "Yes. As long as the company can continue to pay dividends at this level for a long time, it is indeed better than the average person going to work. The only risk is that the company cannot maintain this level of dividend."For long-term investors, dividends are extremely important. Purchasing stocks in high-dividend companies with an investment of over one million yuan can indeed make it possible to achieve a "life of lying flat."
Yesterday, some listed companies in the automotive industry announced an increase in their performance forecasts: for example, Weichai Power's performance is expected to increase by more than 50% in the first half of the year, China National Heavy Duty Truck's performance is expected to increase by 45%, Zhongtong Bus's performance is expected to increase by more than 82% in the first half of the year, and BYD's performance is expected to double. These impressive performances have exceeded market expectations, hence, the automotive sector stocks surged this morning.
Overall, the valuation of the automotive sector is not high, and I believe the current rise in the automotive sector is a reasonable return to value. Value for money is the foundation of stock investment, yet many investors do not understand this point. An increase supported by performance is equivalent to a person with genuine talent and learning receiving a deserved promotion. An increase in stock prices without substantial performance support is equivalent to a person without genuine talent and learning, who has obtained a promotion through improper means. The foundation of such a promotion is not solid, and it is very likely to collapse in the end.
For example, the stock price of Huamai Technology has more than doubled in the past month, but this increase is due to speculative speculation. Essentially, it is a game of hot potato.
The company's performance is very poor, and the company has announced that it does not have AI-related technology. Therefore, at the opening today, a large group of speculative funds began to sell frantically, and finally, the stock price hit the daily limit down in the afternoon. Investors who did not escape in time may find it difficult to withdraw completely tomorrow.
In the stock market, there are two types of rises every day: one is a rise caused by value for money, which is a return to value; the other is a rise caused by speculative speculation, which is a bubble-blowing rise. Truly mature investors should stay away from this kind of rise brought by speculative speculation and focus on the rise driven by value support.
Currently, many sectors in the A-share market have the demand for value return, and their future rises are all safe, supported by performance, and have a huge space for rise. For example, the consumer sector, the North China 50 sector, the real estate sector, and Zhongtegu, etc., these sectors are worth buying vigorously!
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