Recently, the collective killing of A shares hugs will give many people. Looking at the account to get out of the day, the investor is full of chest, and regrets that you can’t sell it earlier; follow-up to each rebound, let investors suffocate, tangled this should not be decisive.
There is a saying in the stock market, \”I will buy apprentice, the master will sell.\” In addition, the selling points are more testing more about buying points. How should stocks sell? Different investors follow different trading systems, in this article, our focus of value investors sell concepts.
Two types of value investors
In stock market, value investors are an important genre. They are generally recognized that the following investment philosophy: \”Buy stock is to buy a company\”, \”pursuit when buying Safety marginal \”,\” Mr. Market has repeatedly invincible, but long-term look at the price to value \”,\” only in the capacity circle \”.
There are two income sources of value investment, one is the income of low-cost buy, price return value; a piece is the income of the company’s own sustainable development. Around these two sources, in the practice of decades, value investors gradually divided into two geography:
Representative of Graham, buy, value returns after underestimation Out, earn a value difference; a represented by Buffett, Mangger, and emphasize the cost of buying excellent companies in a reasonable price, long-term holding, earning growth.
In the short term, the price will return to the value of the value, but the long-term sustainable growth of the outstanding enterprises is the biggest value of the stock investment. It is in this sense that Buffett Master has achieved green and more blue from Graham.
The problem of returning a selling point, the value investor represented by Graham will sell when the price is returned, meaning once an overestimation, must be sold, but Buffett The value of the representative, is more willing to accompany you to the long run, more concerned about whether the fundamental changes have changed, generally not selling due to overestimation.
The founder of Himalayan Capital is called \”China’s Buffett\”, in a speech at Columbia University, Li Record asked when he sold, he replied:
\”I have had a principle. If I don’t plan to buy in a price, I can sell. Now (2006) I feel that I have evolved some, because when I have a field, a family When the company produces a hole, I really feel that I am a business. Even if someone says that you should sell, the price is already high, and this price is indeed, I don’t want to buy it again, but from the long-term, I The cave, telling me about this company’s profound understanding, the win is still very big. … When you arrive at this time, you will not want to sell. \”
So, according to Li Lu,Really good, even if the price is high Debu is worth buying, but also did not want to sell.
do not want to buy too expensive, why not sell?
closer look at something, the answer like a paradox: since admitted that the price is very expensive, not worth buying, selling is the rational choice to take advantage of high prices, why do not want to sell it?
to Maotai, for example, if investors bought two years ago, the book has a relatively large floating surplus, beginning of 2021, in the face 60 times earnings, shortly blocked space, a large downside risk . At this point, rational investors are not willing to buy high, sell only the surplus should not do it?
Many investors do this tangle, especially when seen floating profit fell continuously diluted. On this issue, not simply Chaozuo Ye. Learn from others’ answers must know, know why, ultimately with their own situation to make independent decisions.
Li Lu did not want to sell, mainly from three points: First, fear of flying sell. If the stock price continued to sell at a high level, even higher and higher, you may not find the car of a second opportunity. Second, the tax savings problem. In the US stock market, stock exchange money to pay 15% -20% of the capital gains tax, ranging from (A shares do not have this problem), to be sold as floating profit after tax, no tax saving effect. The third is to focus on long-term investment, as long as a good long-term prospects, profits and losses do not care about short-term gains and losses.
know why, you can combine the characteristics of the A-share market to make adaptive changes. First, the A-share market speculative strong, often overvalued stock prices is not just a problem, but the crazy overvalued problem; secondly, the A shares can be secured not related to tax issues, tax sparing effect impossible to talk rise. Third, if investors do not focus on long-term gains, selling is reasonable. This leads to the A-share market to sell requires different logic, as also believes in the value of investment assets Gray, founder Zhang Kexin has talked about:
\”A lot of domestic value investors, investment income is not ideal, it is a important reason is that the value of the investment is long-term holding mechanistic understanding not to sell. but imagine, when the stock price has seriously than the intrinsic value, what is the purpose of holding it? is it worth waiting for the stock price to fall down to look for it? \”
when it comes now, the standard answer is almost certain: for the long-term bullish on the stock, overestimated reason not to sell, but crazy overrated, it should be firm to sell.
The answer seems to come out, but has a new problem, what is it crazy overrated?
What are the criteria crazy overrated?
stock valuation is the discounted future cash flows, it is necessary to forecast the future of the profitability of enterprises, also need to consider the level of the discount rate, it is inevitable subjective component, which also determines the fundamental precise valuation does not exist We can grasp only an approximate that Buffett called \”fuzzy right.\”
The evaluation methods included mainstream PE PE, PB PB, sales ratio PS, cash flow stickersThe model DCF, segment valuation and other valuation models, each of which have its advantages and disadvantages, suitable for different developmental stages of different types of enterprises and enterprises.
For example, the P / E rate PE is the most mainstream valuation indicator, which is suitable for enterprises with a relatively stable earnings;
For heavy asset industries, there is a lot of depreciation amortization, and the profit cannot be Representing future profits, more suitable for the city net rate PB valuation method; for the periodic industry, such as pig industry, profit fluctuations, the price-earning ratio indicators are easily misleading, the net rate is better index;
[ 123] Enterprises that are easy to accurately predict in cash flows, such as innovation drug companies, market multi-cash flow models for valuation.
In this sense, the price of P / E ratings, the high and low rate of the city is not judged by the absolute standards of the valuation, similar to the development of technology companies, the unprofitable Internet companies, etc., the price-earning ratio is usually very high, even negative However, it is not possible to obtain a serious overestimation of shares.
Investors can rely, more of the reference historical valuation levels to draw a relatively blurred conclusion. For example, a stock’s historical P / E rate range is 15-50 times.
This operation may also be wrong. Once an error, the bear is good, and there is no 100% winning rate in the investment.
What to buy after sell?
In many value investors, holding cash is unwise, before selling, investors must think about what to buy. For example, Li Ze has mentioned three standards sold, the first is to buy the wrong, the second is to rising screaming, the third is to exchange better target, namely:
\”As an investment manager, Your job is constantly improving your portfolio. You start from a high standard and continue to improve this standard. The way to achieve this goal is to continuously discover better investment opportunities, constantly optimize the opportunity cost. This is I will sell Three possibilities. \”
What to buy is not within the discussion of this article. However, considering that most investors will instinch to instinct low-rate stocks, here remind a few low valuation traps, what can’t be bought.
First, the winner will eat non-drag players in the industry. As the name suggests, the industry that the winner is eaten is only the value of investment. The non-dragon players can’t make the winner, the survival capacity is worrying, and the valuation can not be purchased.
The second is the non-headed enterprise in the sunset industry. The sunset industry, the industry lacks growth space, internal acceleration of the survival of the fittest, the survival space of non-head enterprises has narrowed, and the valuation can not be purchased.
The third is a cycle of cycle vertices. If the bull market is high, the pig stocks in the pig price are high when the pool is high, and the profitability has increased significantly, causing the P / E ratio at a very low level.It looks very cheap, but the industry is about to step into the decline, the company’s profitability is rapidly shrinking, and it is easy to be printed by the high level.
Taking the Shares of the Pig Breeding Enterprise as an example, the dynamic price-earning ratio exceeds 400 times September 2019, but the stock price at this time is still relatively low; then, with the rise of pork prices, the increase in corporate profits has grown sharply. The price-earning ratio has fallen down all the way, and it has fallen to 9.93 times low, but the share price of this time has become high.
Investor’s investment forward
It is not difficult to see that it is a study, sell it. Rear replacement Buy is a learning, there is a need for some insights and decisions, which belongs to the middle and high difficulty. For ordinary investors, \”selling skills\” is not easy to master, but it is easy to wait – the original intention is the value investment, but actually become a speculative player of frequency transactions.
What is better way? Highly dispersed + long-term holding, such as Buffett said,
\”I think 98% to 99% investors should be highly scattered, but they cannot trade frequently, their investment should be highly low-cost index funds Almost. For ordinary investors, this investment is a forward road. \”
Because it is highly dispersed, it is not necessary to pay an overestimation of individual stocks, and do not involve selling buying problems. For example, this is the investment forward road of ordinary investors.
This article is originally created by the public number \”Xue Hong\”, the author is Xue Hong, deputy dean of Suning Finance Research