Question 2: What does the lemming effect mean?
Lemmings; A group of irrational retail investors who easily fall into collective unconsciousness. Buffett once compared lemmings to securities institutions. Shareholders are like lemmings' families. When the wealth effect of investors is amplified, it will immediately spread to other people's ears. People will continue to join the market and the number will expand rapidly, so the market will expand rapidly. To illustrate the follow-up effect of the stock market, and finally give us advice, don't believe in the market, but believe in yourself.
Lemming is a very common and lovely little animal, which lives in the Arctic all the year round. It is oval with short limbs, smaller than ordinary mice, and can grow to 15 cm, with short tail and small ears. Lemmings are mainly distributed in high-latitude coniferous forests in northern Norway and Eurasia, and lemmings are the most fertile animals in the Arctic.
But why has the number of such animals been small? Because these things have one characteristic. When the number of lemmings expands rapidly and reaches a certain density, a strange phenomenon happens: at this time, almost all lemmings will suddenly become restless, change their old timidity, appear fearless in front of any natural enemies, obviously provocative, and sometimes even take the initiative to attack. The only possible and reasonable explanation is that they try their best to attract the attention of natural enemies in order to devour them more, which is tantamount to suicide.
What drives lemmings forward is not the desire to die, but the panic. Including the fear of hunger and the fear of getting lost. Just as the sudden increase of investors leads to too much money chasing too many stocks, investment opportunities suddenly decrease. When the market plummets, the space for withdrawing from the market will be very narrow, and collective panic will lead to suicidal selling by investors. . .
Mr Buffett once compared lemmings to securities institutions to illustrate the follow-up effect of the stock market. Finally, his advice to us is: don't trust the market, believe in yourself.
Causes of lemming effect
There are two reasons for the lemming effect. First of all, group members tend to be consistent with other members' behaviors and beliefs in order to gain group identity and sense of belonging. Second, when group members are not sure about the events that need to be decided, it is often safe for them to imitate and obey others' behaviors and beliefs.
The lemming effect is fully reflected in human investment activities. People's investment behavior is often influenced by others. When most investors fall into greed and madness, few investors can calmly and rationally resist the temptation to buy; And when most investors are in fear and desperately kill down, few investors can resist the impulse to sell.
The pressure of conformity is enormous. However, wise investment decisions are often unexpected and reasonable decisions. The investment value of the hot plate you see has usually been overdrawn in advance, and smart investors generally keep observing and tracking the stocks with investment value. When their share price falls within a reasonable range (ignored by most investors), they will eat it decisively.
Obviously, this requires not only professional value evaluation, but also the firm will to resist the pressure of conformity and the great courage to be the first in the world. To get out of the emotional whirlpool of the stock market, we must find the irrational behavior of most investors. They buy stocks not based on logic, but on emotion.
Lemmings are the collective name of about 20 small herbivores living in the Arctic. People have long noticed that their numbers will change periodically, some years are particularly large, and some years are very rare. As a result, various legends have emerged. In the 16 and 17 centuries, many European scholars believed that lemmings fell from the sky; As long as the air conditions are suitable, lemmings can be spontaneously generated. At that time, Danish naturalist Orr Forme dissected lemmings for the first time to refute this statement, proving that the anatomical structure of lemmings is similar to other rodents.
Lemmings suddenly fell from the sky because of their amazing reproductive ability. Lemmings can reproduce about a month after birth, and a female mouse can give birth to a litter of about 8 mice every 5 weeks. When the conditions are suitable, the number of a lemming population can be increased by 10 times in one year. Every four years or so, the number of lemmings will peak, and then it will drop sharply, so it is difficult to find. Where have all these lemmings gone?
Legend has it that when the number of lemmings reaches its peak, they will spontaneously migrate collectively and commit suicide in the sea, leaving only a few similar people behind to undertake the sacred task of carrying on the family line. In the documentary "White Wilderness" filmed by Disney in 1958, the lemmings migrated in groups and finally committed suicide by jumping into the sea, with very sensational explanations. This Oscar-winning film has far-reaching influence, and the touching legend that makes lemmings go to the death Covenant is well-known in the west.
But the scene of that documentary was faked. The film was shot in Alberta, Canada, where lemmings are not produced. The photography team went to the North Pole to buy dozens of lemmings from Inuit children, let them run on a turntable covered with snow, shoot from all angles, and after editing, thousands of lemmings migrated. After that, the film crew took the lemmings to the edge of the cliff, hoping to film them jumping into the river under the cliff and drowning. Unexpectedly, lemmings didn't want to jump. After waiting for two days, the impatient photography team drove the lemmings off the cliff and committed suicide by jumping into the sea.
Why the number of lemmings changes periodically is an inconclusive biological topic, which may be related to natural enemies, food, climate, seasons and other factors. For example, an obvious but unconfirmed explanation is that the rapid increase in the number of lemmings destroyed the vegetation, resulting in food shortage and a large number of lemmings starved to death. Then the vegetation began to recover and a new cycle appeared. In fact, this phenomenon is not unique to lemmings. Other small animals living in harsh conditions will have similar periodic changes in their populations.
Although there are different views on the answer to this question, experts agree on this point: lemmings will not commit suicide collectively. When the number of lemmings increases sharply and local food becomes scarce, lemmings, like other animals, will spread to other places. It is observed that in the mountainous areas of Norway, the lemmings on the mountain spread to the valley, and some of them will gradually reach the lake and the seaside and settle down there. But with more and more latecomers, some will try to swim to the other side, and some will be drowned. This may be the source of the myth of collective suicide of lemmings.
In recent years, some experts have tried to explain the mystery of the decline in the number of lemmings from their own changes. For example, with the increase of mouse population density, the social interaction and pressure between lemmings increase, which leads to the change of hormone levels in the body, thus reducing its fertility and becoming more aggressive. When the population density is too high, lemmings' reaction is not to sacrifice themselves, but to attack other lemmings and even kill each other.
The myth that lemmings are about to die will not disappear as easily as the myth that lemmings fall from the sky. No matter how the experts clarify, this myth will always be regarded as a scientific fact and handed down as an educational natural wonder. After all, for many people, beautiful lies are better than cold facts.
Have you ever seen the legendary lemmings jump into the sea?
From hundreds to tens of thousands, the lemmings who walk in front will jump into the water and build a mouse bridge for their successors. When encountering a cliff or a deep ditch, thousands of lemmings huddle together to form a big meat ball and roll down regardless of life.
This group of lemmings has now stood on the cliff near 2800 A shares in China, and is preparing to dive into the unknown sea. Maybe it won't be long before everyone can witness their tragic performance.
Since mid-August last year, China A-share market has made rapid progress by challenging bull market thinking. Even occasionally there will be large intraday fluctuations, which is a warm-up dance and gives courage to retail investors.
Now China A shares are more and more like a besieged city. People inside want to stumble out, but people outside the city rush in one after another. Judging from the trading volume in recent days, the Shanghai Stock Exchange has been trading for 80 billion days in a row, which means that more than 80 billion lemmings are thrown into the sea every day. Of course, 80 billion funds are secretly glad to escape every day.
Of course, it is still too early to say that A shares will adjust, at least until the stock index futures come out, there will certainly be no real correction. However, if the current daily turnover of nearly 80 billion cannot be sustained, or if more lemmings do not rush in to take over for the squirrels inside, small changes will be inevitable in the short term.
Pity these lemmings, they either give money, find relatives and friends, or take all their possessions. They want to get something for nothing in the current colorful A-share bull market, and finally get themselves and all their hopes.
What is disturbing is that even in the process of these lemmings jumping into the sea, many organizations sang praises for them. Some institutions even bought China Industrial and Commercial Bank, the leading A-share stock, for three consecutive years, with a price-earnings ratio of nearly 40 times, while some institutions have a price-earnings ratio of 200 times for China Life.
However, don't underestimate the strength of these lemmings. Once these lemmings burn money in the stock market, it will inevitably have a vicious impact on China's macro-economy. 200 1, the China stock market bubble burst, followed by deflation, which is no coincidence. Especially in the current economic imbalance at home and abroad, the sharp drop in consumption caused by the collapse of wealth will make China's current consumption-oriented economic policy go up in smoke.
Of course, maybe not all lemmings will disappear in the next wave of market. There may be more lemmings crawling ashore after choking a few mouthfuls of water, and some lemmings will be rescued by the PLA later. But a considerable number of lemmings, especially those who have no experience in the stock market and blindly pursue heights, may live in the sea forever.
Lemming effect and anti-market investment law
The lemming effect of group panic occurred during the crash, and investment opportunities also came at this time. After the last round of plunge, even the most optimistic business researchers can't believe that the stock market can heal the scars after the plunge so quickly: the Shenzhen Component Index fell by 20.87% at most in the five trading days after May 30. However, after that, it even pulled 7 Yang to force the air to hit a record high. It closed at 138 1 1 yesterday, up 2.64% from May 30.
Open the daily K-line chart of Shenzhen Stock Exchange, and the typical V-shaped reversal makes people sigh the beauty of the bull market. In the market adjustment, both institutional investors and individual investors firmly believe that the long-term bull market pattern of Shenzhen and Shanghai stock markets will remain unchanged. However, what caused them to sell stocks in the most panic? This article tries to decode it for you.
There are suddenly no buyers in the market. In the first two weeks, the Shenzhen and Shanghai stock markets suffered a big bull market panic: from May 30 to June 5, many stocks were sold by way of down limit. Among them, Ying Da Group became the diving champion of listed companies in Shenzhen with five consecutive daily limit. Its share price dropped from 17.95 yuan to 10.63 yuan, with a short-term decline of 40.78%.
In the absence of sudden changes in the fundamentals of individual stocks, hundreds of stocks like Ying Da Group were suddenly sold off by the market just because the policy suppressed excessive speculation.
The daily limit usually means the disappearance of individual stock liquidity. What fear makes a large area of stocks in the market suddenly have no buyers?
The sudden introduction of the stamp duty increase was somewhat unexpected and caused a fierce reaction. In an emotional state, it is difficult for people to treat it rationally for a while, so the stock market has experienced a serious oversold. Gui, chief analyst of Shen Yin Wanguo Securities Research Institute, believes that at the beginning of the plunge, everyone could not adapt for a while, and many investors fled desperately, so that the whole market fell into panic and formed a continuous limit.
Rome was not built in a day, nor was it destroyed by the sudden arrival of a day. On the surface, the stock market crash that began on May 30th was the result of the increase of stamp duty policy. But it is more because the valuation rises too fast, the structural bubble expands rapidly, and there are too many short-term profit chips in the market, which need to be changed through shocks.
The market generally believes that it is correct for the management to raise stamp duty and adopt appropriate policies to curb excessive speculation in the context of the recent monthly turnover rate of Shenzhen and Shanghai stock markets exceeding 100%, but the way of adjustment is the trigger for this major adjustment.
The way out of the market is very narrow. It is reported that every big bull market always magnifies the wealth effect and attracts a large number of new investors to enter the market. The data shows that the number of newly opened accounts in the first four months of this year was as high as 3.42 million, 6.5438+0.27 million, 40.65438+0.08 million and 6.7 million respectively! In the first four months of this year alone,15.4 million households were added, more than three times the number of new accounts opened last year. On May 28th, the number of new A-share accounts in China reached a new high, reaching 385,300, and the total number of accounts in Shanghai and Shenzhen stock markets reached100273,600.
The sudden increase of investors has led to too much money chasing too many stocks, and investment opportunities have suddenly decreased. This reminds the investment community of the famous lemmings phenomenon: the lemmings in Norway increase sharply every ten years, and they have to go through a large-scale migration journey to find food, but they always end up in a collective way.
The influence of lemming effect
The lemming effect of group panic occurred during the crash, and investment opportunities also came at this time. After the last round of plunge, even the most optimistic business researchers can't believe that the stock market can erase the scars after the plunge so quickly: the Shenzhen Component Index fell by 20.87% at most in the five trading days after May 30. However, after that, it even pulled 7 Yang to force the air to hit a record high. It closed at 138 1 1 yesterday, up 2.64% from May 30.
Open the daily K-line chart of Shenzhen Stock Exchange, and the typical V-shaped reversal makes people sigh the beauty of the bull market. In the market adjustment, both institutional investors and individual investors firmly believe that the long-term bull market pattern of Shenzhen and Shanghai stock markets will remain unchanged. However, what caused them to sell stocks in the most panic? There are suddenly no buyers in the market. In the first two weeks, the Shenzhen and Shanghai stock markets suffered a big bull market panic: from May 30 to June 5, many stocks were sold by way of down limit. Among them, Ying Da Group became the diving champion of listed companies in Shenzhen with five consecutive daily limit. Its share price dropped from 17.95 yuan to 10.63 yuan, with a short-term decline of 40.78%.
In the absence of sudden changes in the fundamentals of individual stocks, hundreds of stocks like Ying Da Group were suddenly sold off by the market just because the policy suppressed excessive speculation. The daily limit usually means the disappearance of individual stock liquidity. What fear makes a large area of stocks in the market suddenly have no buyers?
The sudden introduction of the stamp duty increase was somewhat unexpected and caused a fierce reaction. In an emotional state, it is difficult for people to treat it rationally for a while, so the stock market has experienced a serious oversold. Gui, chief analyst of Shen Yin Wanguo Securities Research Institute, believes that at the beginning of the plunge, everyone could not adapt for a while, and many investors fled desperately, so that the whole market fell into panic and formed a continuous limit.
Rome was not built in a day, nor was it destroyed by the sudden arrival of a day. On the surface, the stock market crash that began on May 30th was the result of the increase of stamp duty policy. But it is more because the valuation rises too fast, the structural bubble expands rapidly, and there are too many short-term profit chips in the market, which need to be changed through shocks. The market generally believes that it is correct for the management to raise stamp duty and adopt appropriate policies to curb excessive speculation in the context of the recent monthly turnover rate of Shenzhen and Shanghai stock markets exceeding 100%, but the way of adjustment is the trigger for this major adjustment.
The way out of the market is very narrow. It is reported that every big bull market always magnifies the wealth effect and attracts a large number of new investors to enter the market. The data shows that the number of newly opened accounts in the first four months of this year was as high as 3.42 million, 6.5438+0.27 million, 40.65438+0.08 million and 6.7 million respectively! In the first four months of this year alone,15.4 million households were added, more than three times the number of new accounts opened last year. On May 28th, the number of new A-share accounts in China reached a new high, reaching 385,300, and the total number of accounts in Shanghai and Shenzhen stock markets reached100273,600.
The sudden increase of investors has led to too much money chasing too many stocks, and investment opportunities have suddenly decreased. This reminds the investment community of the famous lemmings phenomenon: the lemmings in Norway increase sharply every ten years, and they have to go through a large-scale migration journey to find food, but they always end up in a collective way.
However, don't underestimate the strength of these lemmings. Once these lemmings burn money in the stock market, it will inevitably have a vicious impact on China's macro-economy. 200 1, the China stock market bubble burst, followed by deflation, which is no coincidence. Especially in the current economic imbalance at home and abroad, the sharp drop in consumption caused by the collapse of wealth will make China's current consumption-oriented economic policy go up in smoke.
Of course, maybe not all lemmings will disappear in the next wave of market. There may be more lemmings crawling ashore after choking a few mouthfuls of water, and some lemmings will be rescued by the PLA later. But a considerable number of lemmings, especially those who have no experience in the stock market and blindly pursue heights, may live in the sea forever.