A few days ago, there was a newly listed stock called Meng Gu Li, which once surged by 3700% on the first day of trading! Many people in my friend group were envious, jealous, and resentful, regretting that they didn't buy this new stock and didn't make a 37-fold profit!
The reason for this new stock's surge is very simple, it's the market's speculative hype. Since its floating market is only tens of millions and it is a new energy concept stock, it has been chosen by the market as an object for speculation and price lifting.
When I was young, I was also very envious of such soaring stocks. At that time, I frequently participated in market speculation, feeling particularly exciting, but in the end, I didn't make much money.
The reason is that the probability of success for such overnight wealth is too low! Taking Meng Gu Li, which increased by 37 times on the first day of listing as an example, if you want to make this 37 times, you must subscribe to its new shares. The winning rate of its new shares is three in ten thousand! That is, the highest success rate is only three in ten thousand. And you also need to sell at the highest price during the sudden rise in the afternoon of the first day of listing, and the success rate of making 37 times is even lower, there is no success rate of one in ten thousand.
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The success rate of chasing the daily limit and capturing hot spots in the market is also not high, it is definitely lower than 50%! Many individual stocks that hit the daily limit do not rise the next day, but fall or even plummet. Many hot concepts cannot continue to rise, and they often start to fall continuously after we buy.
When I realized that short-term speculation is just beautiful in appearance, but in fact, it is like a mirage, I gradually became a medium and long-term investor. I no longer envy this kind of speculation that rises every day, and increases by 37 times in one day. I never watch the market anymore, only to write articles, I have to take a few glances at the market after the market closes.
I have understood that this low success rate of hot spot speculation is essentially no different from buying lottery tickets. Indeed, some people have made 37 times, and some people have won the lottery, but that person is likely not you! On the contrary, after participating in the speculation, it is likely that you will pay the bill and make clothes for others.
Whether a person's investment philosophy is correct or not depends on his reaction to these quick wealth-making events in the stock market. Those who are keen on this kind of concept speculation, sector rotation, and chasing the daily limit are all on the path of speculation and gambling without realizing it.
Just like people on the gambling table, they are doing things with a low success rate of making money, but everyone thinks they can win. So who will lose?I have a friend who is particularly fond of chasing stocks that hit the upper limit and capturing bull stocks. Since the beginning of this year, he has already lost 60%! Of course, he has also won bets in the stock market before. However, he forgot the principle that "long-term gambling is bound to lose." If he continues to speculate and hype for a long time, he will inevitably be the one to lose money.
Many people are not unaware of this principle, nor are they unaware of the risks of speculation and hype. It's just that they are too eager to make money quickly. As a result, they always harbor a fluke mentality and do things that are like "taking the chestnuts out of the fire."
Thoughts determine mentality. In my opinion, only by changing one's mindset can one change one's mentality. Change the idea of making money quickly and transform it into the mindset of being content with gradually becoming rich through investment. Eliminate the fluke mentality and do things that are more likely to succeed. This is the "great transformation of the tiger," which is not only a change in investment philosophy but also a change in life philosophy. Obviously, this change is extremely difficult.
When I was young, I was brutally beaten by the market thousands of times and ran into walls everywhere. After I became desperate about getting rich quickly, I gradually realized that doing things that are more likely to succeed and "gradually becoming rich" is the truth of life and investment. At this time, I was already middle-aged.
Many people have not been beaten by the market enough, or although they have been beaten by the market thousands of times, they have never deeply reflected on themselves. Therefore, they will never be content with gradually becoming rich in their lifetime. They will continue to chase hot spots and capture the upper limit until one day they are completely sunk by the market.
Only when people completely despair of getting rich overnight can they be willing to take one step at a time on the right path and be willing to do value investment. As the saying goes, "If the heart of the thief does not die, the heart of the Tao does not arise."
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