When brokerage stocks rise, they often drive other cyclical sectors to become active, and the market expects it to reach a high point at this time. The surge in brokerage stocks reflects the enthusiasm of investors.

The rise in brokerage stocks is related to market fundamentals. Economic fundamentals are gradually improving, and the A-share market is gradually recovering and rising. In addition, as the pace of IPOs accelerates, the business volume of securities firms increases. Brokerages are a strong cyclical industry. When brokerage stocks rise, they often drive other cyclical sectors to become active. The market is expected to reach a high point at this time. This surge in brokerage stocks can reflect the enthusiasm of investors. When the A-share market improves, brokerage stocks are the most resilient.

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Notes on investing in brokerage stocks:

In the early stages of a trending market, brokerage stocks usually do not rise much and provide opportunities for intervention on the right side. It is generally believed that if it is judged that the market will turn from bear to bull, finding the market turning point and accurately intervening in securities stocks will yield the greatest benefits. But the reality is that in the early stage of the market rebound, adding securities companies' stocks will not make relative gains in the short term, and it is easy to fall into losses.

In the swing market, the greater the initial increase in brokerage stocks, the worse the sustainability. From a historical perspective, if brokerage stocks have already accumulated a large increase in the early stage of a rebound, its sustainability is questionable. A more appropriate and safe approach is to wait for the market trend to be established (if there is a trend opportunity) and the securities company's performance expectations improve, and it will not be too late to participate on the right side at that time. And if the current increase in brokerage stocks is still small, and investors are optimistic about the subsequent market, they may wish to increase their allocation to brokerage stocks, as the probability of success is higher.

Baidu Encyclopedia-Brokerage Stocks