Foreword: Few people make profits from earnings per share, and earnings per share are generally distributed to large customers. The dividends received by retail investors are pitiful (listed companies explain that they will expand reinvestment), and the stock price will Earnings per share is the price-to-earnings ratio. Some stocks have a price-to-earnings ratio of hundreds of times, and some people want them! This is stock trading!
You will understand after reading the following "The Story of Stock Trading".
Suppose there are two people selling sesame biscuits in a market. There are only two people. Let’s call them sesame biscuits A and sesame biscuits B. Assume that the prices of their sesame cakes are not regulated by the Price Bureau. Assume that they can break even (including the value of their labor force) by selling each sesame seed cake for one yuan. Assume they have the same number of biscuits. ——Economic models are like this, requiring a lot of assumptions. Let’s also assume that their business is very bad and there is not a single person buying sesame seed cakes. They stood like this for a long time, bored.
A said it was boring.
B said it was boring.
Those who read the story will say: It’s so boring.
The market at this time is called very inactive!
In order to prevent everyone from being bored, A said to B: How about we play a game? B agrees.
So, the story begins...
A spends one yuan to buy B a sesame seed cake, and B also spends one yuan to buy A a sesame seed cake, and pays in cash.
A spends another two yuan to buy B a sesame seed cake, and B also spends two yuan to buy A a sesame seed cake, and pays in cash.
A spends three yuan to buy B a sesame seed cake, and B also spends three yuan to buy A a sesame seed cake, and pays in cash.
......
As a result, in the eyes of everyone in the market (including you who read the story), the price of sesame cakes skyrocketed, and soon it reached 60 yuan per sesame cake. But as long as A and B have the same number of sesame biscuits, then no one makes money and no one loses money, but their assets "appreciate" after revaluation! A and B have "wealth" many times higher than in the past. Their worth has increased a lot, and their "market value" has increased a lot.
At this time, there was passerby C. When he passed by an hour ago, he knew that sesame cakes were one yuan each, but now he found out that they were 60 yuan each. He was surprised.
An hour later, passerby C found that the sesame cakes were already 100 yuan each, and he was even more surprised.
An hour later, passerby C found that the price of sesame cakes was already 120 yuan. He bought one without hesitation because he was an investor and speculator. He was sure that the price of sesame cakes would rise. There is still room for growth, and someone has given a "target price" of more than 200 yuan (in the stock market, he is called a stockholder, and the person who gives the target price is called a researcher).
Under the demonstration effect of Shaobing A and Shaobing B "making money", and even the demonstration effect of passerby C making money, more and more passers-by bought sesame cakes, and more and more people participated in the transaction. The price of sesame biscuits is rising steadily, and everyone is very happy, because it is strange: no one loses money...
At this time, you can imagine, who has less sesame biscuits, A or B? , that is, whoever has less assets will really make money. Among those who participate in the purchase, whoever has no more sesame cakes in hand will really make money! And everyone who sold it regretted it - because the price of sesame seed cakes was still rising rapidly...
Then who lost money?
The answer is: No one lost money, because many people who paid high prices to buy sesame cakes held what everyone recognized as a high-quality asset of equal value - sesame biscuits! And shaobing is obviously better than cash! How much interest can you earn by depositing cash in the bank? How can it compare to the soaring price of sesame cakes? Everyone even agrees that the supply of sesame biscuits in the market exceeds demand. Can I buy sesame biscuits futures? So subscription warrants appeared...
Someone asked: Will you never lose money buying sesame seeds? It seems so. But the world is so strange. Suddenly a man named Li Zi came to the market. Li Zi said: There are times when you lose money! So when will everyone lose money?
Hypothesis 1: There is a price department in the market, which believes that the price of sesame cakes should be one yuan each. (Supervision)
Hypothesis 2: There are many people making sesame cakes in the market, and the price is one yuan each. (Same theme)
Hypothesis 3: There are many products in the market for playing this kind of game. (Release)
Hypothesis 4: Everyone suddenly realizes that this is just a sesame seed cake! (Value Discovery)
Assumption 5: No one is willing to play the game of buying and selling anymore! (The truth comes out)
If one day, any of the assumptions appears, then on that day, those who have sesame cakes will lose money! So who made the money? He is the one who possesses the least asset - Shaobing!
The story of selling sesame biscuits is very simple. Everyone thinks that people who buy sesame biscuits at high prices are fools, but let’s look back at the people in the market where we are.
Isn’t this true of some of the so-called asset revaluations and asset injections in this market? When ROE is high and assets have high premiums, the principle of asset injection is the same as selling sesame seeds. Whoever holds the least assets is the one who makes money and whoever gets high returns!
So as an investor, you should look at asset revaluation and asset injection rationally, and don’t fool yourself when you deceive others, especially don’t deceive your own money!
In the case of asset injection under high ROE, especially the backdoor listing of securities companies, additional issuance to purchase the assets of major shareholders, additional issuance of assets, etc., you must keep your eyes open and polish again, and be cautious and cautious!
Because you are likely to become a passerby holding high-priced sesame seeds!