How to define investment and speculation, and what is the difference between them?

The core definitions of investment and speculation. Speculation, in English, means speculation

In fact, I have always thought that the Chinese word "speculation" is very good and has a deeper understanding of the nature of speculation than its English counterpart. "Opportunity" means opportunity in Chinese.

So, what is my core definition of speculation?

Speculation is the analysis and grasp of opportunities.

Timing determines the timing of buying and selling. The difference between the two is the driving force for speculators to operate. This price difference must be brought by the timing, not the time period.

For example, when I buy bonds, the contract yields 5% a year, but because I sell high and suck low, I earned 7% this year. Then, my speculative income is only 2% instead of 7%! If I earn 4% this year, my speculative income will be-1%.

Futures is the base camp of speculators. We can give an example to understand through futures speculation:

You buy 1 commodity, and you will sell a commodity in the future. The product itself will not change from 1 to 2. So, why did you buy this product?

Investment, in English, has positive significance. Unlike speculation, investment is more in line with public morality.

Investment, in essence, is that you throw money out for another object, and the object itself can add value.

(Does anyone refute it? Try to find a counterexample? )

However, if this is used to define investment, will it be questioned?

For example:

Investing in stocks ~ ~ that is, investing in companies, the motivation is that companies can grow and make profits.

The motive of investing in the spot is that the spot can increase in value (worth more money) as the price rises, which is also an investment (some people think that hoarding the spot is not an investment? Probably a lot, hehe).

Investing in real estate ~ ~ This is an advanced version of the investment spot, and its particularity lies in the finiteness of the core lot. Because of this particularity, real estate is more valuable than ordinary spot that can be produced continuously.

Investment bonds are easy to understand. Bonds and stocks are two basic contents of securities. The bond market in the United States is huge, but China has not developed for the time being. The bible of investors, Securities Analysis, also explains a lot about bond investment.

Investment bank ~ ~ That's right! Saving money is also an investment, and the rate of return is the interest rate! If someone insists on talking about negative interest rates again, he doesn't understand the essence at all. )

Looking back, let's look at two famous pioneer factions of value investment.

Graham: Pay attention to buying at a low price.

Fisher: Focus on growth.

Buffett said that he is more like the former.

So, does investment mainly refer to "buying at a low price"?

This is a common view that many senior investors accuse pseudo-investors. "Buying the so-called blue chip at a high price simply doesn't understand investment."

I quite agree with this view.

But I also want to express a point: buying at a low price is an act of pursuing the margin of safety, which has nothing to do with value investment. Fisher is a purer investor. In other words, buying at a low price is a very good auxiliary means of the value investment operating system, not the value investment itself. The essence of investment is not to buy things with a value of 1 yuan 10 yuan. This behavior, anyone will do it-as long as he has the ability to determine the value of that thing 10 yuan, and he can sell it later.

Once again:

Investment, in essence, is that you throw money out for another object, and the object itself can add value.

The speed and certainty of appreciation (whether there is risk or not) are the most important evaluation basis for investment.

A natural conclusion: investment needs to be held for a long time. Contrary to speculators who need long-term short positions.

Very simple, your income = object appreciation speed × holding time.

Now, we can understand why value investment masters attach importance to long-term holding and why value investment masters never short. Looking at the K line is speculation? Reading statements is investment?

The previous long speech can be summed up in two sentences:

Investment = investment growth, speculation = investment opportunities.

Looking at the K-line, it is difficult to see growth, but it is not impossible. Show anyone the historical K-lines of Vanke and Changhong, and he will tell you that Wankobi Changhong has high growth and high investment value.

However, this investment value and growth refers to what happened in the past, not the future.

Investment is for the future.

K line is not enough to see future growth. It's too uncertain.

However, to see the future growth, it is far from enough to look at the report.

This report only reflects history. If we only infer the future based on a company's past growth and profitability, I think it is not much better than looking at the K-line.

Isn't it? People who look at the K line will think that the stock will rise in the sixth month when they see that it has risen for five months in a row. According to the report, this company has been growing at a high speed for five consecutive years, so you think it will grow at a high speed in the sixth year. What's the difference between this analysis and K-line trend analysis? It is difficult to study companies and industries. An industry researcher who has the technical foundation and solid knowledge of accounting, finance and economy in the industry, has been engaged in research for more than 10 years, and has paid attention to 10 companies, his analysis may not be confident, let alone an ordinary person. Investment is Shaolin kungfu, and it takes too much effort to lay the foundation. But once successful, its certainty may be relatively speculative.

In fact, most real investors do much more than "reading statements".

This is also a necessary effort to pursue certainty.

Briefly talk about my understanding of the work required for investment.

1, understand the industry, understand the industry structure, the formation of competitiveness, technical background and prospects, channels, etc. . . . .

2. Understand the company, competitors, management and technical advantages. . . . .

3, look at the statements, eliminate possible false places and moisture, and have a general understanding of the company's financial history. (first of all, you must have accounting knowledge, otherwise you will be fooled into not knowing. )

4. Forecast the future development prospects of the industry and the company, and conduct certainty analysis and risk analysis.

5. For stock value (not price), it mainly refers to the expected rate of return composed of long-term growth and certainty.

6. Reference other stock prices, credit risk with China characteristics, growth, dividend system and other factors, and consider discount factors to price.

7. Set the margin of safety.

Among them, the hardest part is the ground 5. This part needs to be "quantified". On the basis of nihilism analysis, value and certainty are expressed by numbers. This part needs to choose a reasonable model for different industries and companies, otherwise it will easily lead to differences.

If a stock is priced at 20 yuan (including the discount of uncertainty obtained from analysis), but the investor's "uncertainty caused by analysis model" is 8 yuan, it is best not to buy above 12 yuan.

Question 1: Is there a dead hole in the value investment theory itself?

The answer is yes.

For example, if the long-term prices of all stocks in the stock market are higher than the value and fluctuate, but the prices are too high even in a bear market, what should value investors do?

It is wise not to enter the stock market for ten or twenty years. However, can it really be done? What would happen if Buffett were in China? Will it be forced to short positions for a long time? If you can't choose to invest overseas.

Question 2: How to discount the China stock market?

During the bull market, China had the so-called "golden decade" high growth premium. So, in the bear market, should we consider the discount of credit risk of China enterprises? The interests of the company's management and shareholders are not completely consistent. State-owned enterprises and semi-state-owned enterprises are "institutionalized" rather than "corporatized", and the dividend rate is low (low dividend in a high credit environment is not a disadvantage, but it is definitely a disadvantage in a low credit environment). . . . Wait a minute. Speculation is about timing.

Timing includes: trend operation timing, oversold rebound timing and bottom opening timing. . . . . And so on, but undoubtedly the most widely used and recognized is the trend operation opportunity.

Trend is a core concept of speculation. I think the trend includes three levels.

The first level: technical aspects. K-line trend, time-sharing trend, quantity and energy trend, price trend, and so on.

The second level: the current fundamentals. Interest rate, capital, cpi, industry development, company development trend. . . . . Wait a minute.

The third level: future fundamentals. Through more advanced data, such as the trend of money supply, the trend of credit scale, the trend of population, the trend of age and the trend of gdp. . . And so on, to predict the secondary trend.

The first level is the most intuitive, and in a sense, it is also the arbiter that speculators finally face.

The second level is forward-looking and an important force for institutional investors. If we can grasp this level well, we can not only improve the certainty of speculation, but also grasp the promotion of institutional investors.

If the third level can be done well, it can even be said that it can lead most institutions. But this level of analysis is the most difficult. Perhaps only tall masters like Soros and Greenspan can better grasp this level.

By the way, digression.

Buffett's operating system has little to do with macroeconomics. Unconventional economic disasters still need to be dealt with temporarily. ), pay more attention to microeconomic analysis.

Soros's operating system and macroeconomic analysis are undoubtedly extremely important. Macroeconomics is a compulsory course for trend investors. The same is fundamental analysis. Trend speculators and value investors are different.

Trend speculators analyze "fundamental changes"

Value investors analyze the work that needs to be done before the "absolute value of fundamental pricing" and list 7 points, which is actually not detailed enough.

Simply put, the core work of investment is divided into three steps.

1, judge the growth.

2, judging certainty.

3, judge the value.

Any value investment does not have these three steps. Otherwise, it is definitely not a value investment.

Value investment is very harsh, and this harshness is reflected in quantification.

Value investment of chicken.

Growth: Two chickens, one lays 1 egg every day, and the other lays 2 eggs every day. Which one do you choose?

Certainty: two chickens, one is sick and the other is healthy. Which one do you choose?

Yes, you can easily choose a healthy chicken with many eggs. But this is not a value investment. The most difficult and crucial thing in value investment is-how much are you willing to spend on a chicken?

Some industry analysts wrote: How many Hong Kong stocks are there in xxxx? According to ah discount statistics, how many A shares should there be.

Some industry analysts wrote: xxxx has many advantages compared with YYY in the same industry, so the price should be higher than YYY.

Some industry analysts wrote: How big is the development of xxxx this quarter compared with last quarter, so how much should the share price rise?

These are not value investments.

Value investment ultimately needs one thing: how much this thing is worth.

Back to Fisher and Graham. Fisher was said to be a pure value investment before, but it was still superficial.

Fisher prefers to buy a chicken with two eggs a day, even if it is more expensive.

Graham will carefully judge the price and ability of chicken before choosing. He prefers to buy cheap chickens, even if there are 1 egg in two days.

But only if this chicken is really worth the price. Otherwise, if there is only a flock of chickens at 100 yuan in the market, some will lay 1 egg, and some will lay 3 eggs. The two masters didn't buy it at all, and turned around and left, leaving a group of pseudo-value investors to grab three eggs of chicken. There may be plague chickens in it. 50 yuan is on sale. It's very eye-catching and someone will rob it. Many people equate speculation with risk.

I don't want to talk about stop loss here, nor do I want to talk about fund management or position control. Although both are sharp weapons that speculators often use to counter the "risk theory".

I want to talk about the certainty of speculation.

Sometimes I find that investment and speculation are so similar.

Investment: growth+certainty = value.

What about speculation?

Speculators pursue nothing more than two things, one is to maximize profit space, and the other is to minimize risk.

Isn't this a bit like two key elements of investment?

In my opinion, the certainty of speculation is the first element, and its importance is far greater than the profit margin.

I would rather speculate 90% of the small profits (of course, the premise is far greater than the interest rate) than 60% of the big profits.

How is this reflected in the specific operation?

Give two examples. Senior speculators should understand.

The first example is the most basic.

There are 100 chances, of which 30 are quite sure and 5 are very sure. Then I'll only do those five chances.

The second example is from a technical point of view.

My position control method is: the middle of the heavy position trend.

From a technical point of view, the first and middle stages of the trend are the safest (not the initial stage). In other words, for this certainty, I can give up the 1/3 profit space at the beginning of the trend and the 1/3 space at the end of the trend, as long as I have the strongest certainty in the middle of the trend, I will make a heavy position or even leverage.

Of course, the premise is that unexpected fluctuations will not cause big losses. In other words, the trend of this variety is better to be a stable trend, such as an approximate straight line, rather than an ECG trend.

Maybe someone will covet the whole trend space of 100%, or participate in it for safety. In my opinion, this is contradictory, because position and certainty should be positively related. Talk about my understanding of "technology" based on quantity and price images.

In my opinion, "technology" includes two categories.

One is based on behavioral finance, which mainly describes group psychology; The second category is the analysis and tracking of "bookmakers".

The analysis and tracking of the banker is mainly aimed at some unavoidable clues of the banker, guessing the banker's intention through the identification of the banker's tactics, and deciding the next operation. As we all know, due to the development of the times, the stock market is getting bigger and bigger, and there are more and more game forces, so the analysis significance of "banker" is very small. At best, it is valuable in front of some small-cap stocks.

Mainstream technical analysis is based on behavioral finance, including:

1, the trend technology based on Dow theory, is one of the simplest and most effective technologies. Wave theory is an upgraded version of it, with many details to guide it.

2. Based on the technology of resistance level, resistance level includes transaction intensive area, moving average and integer level.

3. Techniques based on physiology, psychology or event cycle, such as Gann's theory (the defect of Gann's theory is that there is less analysis of transaction volume);

4. Image-based self-realization takes effect, which can strengthen the above three technologies;

5, based on short-term psychological technology, such as oversold rebound.

6, others, such as bottom shape, top shape,. . .

There are many technical theories, and the key lies in what kind of technical analysis to choose under what circumstances. Because all technologies come from group psychology, different psychological forces are different in different situations. This requires users not only to understand the technology, but also to understand the meaning behind the technology and choose flexibly.

A few simple examples:

1, the trend EMA technology is very meaningful, but the shock EMA technology is of little significance.

2. The resistance support level caused by transaction-intensive areas is still effective in most cases, but I can't help smiling when I see that many people have come up with the resistance support level a few years ago. In fact, the transaction-intensive areas a few years ago have long since failed, and the significance of crazy market expansion in the past two years is even smaller. This old support position is not completely ineffective, but the current effect depends more on the self-realization of the image. Try to imagine an interesting scene:

Chicken A, 2 eggs a day, 30 yuan.

Chicken b, 1 egg a day, 20 yuan.

Fisher bought chicken A and has been feeding it to make money by selling eggs. He has a good life.

Graham deliberately chose two B's, and Ge Lao calculated an account: Fisher, you buy 1 chicken in 30 yuan, and I can buy two chickens in 40 yuan! Isn't it two 1 eggs a day? Only spent more 10 yuan. The extra chicken and the chicken itself spent 15 yuan. I saved 5 yuan more than you!

Buffett: Ge Lao, I feel that what you said is still reasonable! I want to learn from you 85%, 15% tuition.

Twenty years have passed. . . . .

Strangely, the price of chicken has been lower than its value for 20 years. However, pure value investors are not afraid of this-we just have eggs, and we don't pursue buying high and selling low!

Twenty years later, Fisher earned 2000 yuan selling eggs, and Graham earned 2000 yuan. Of course, Fisher only voted for 30 yuan and Graham voted for 40 yuan. Fisher beat Greg by a mile.

Buffett: That's impossible. These 20 years will definitely be overestimated. As long as it is sold when the valuation is too high, Ge Lao will definitely win.

Soros jumped out: You just want to buy high and sell low? Are you learning speculation from me?