What are cyclical resource stocks?

Cyclical resource stocks refer to copper mining stocks, aluminum stocks, steel stocks, gold stocks, etc.

Corresponding to resource stocks are non-cyclical stocks. Non-cyclical stocks refer to the necessities in our lives. No matter what the economic trend of the market is, people's demand for goods will not change much. Food and medicine are the best.

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The biggest factors driving the copper market are the relative shortage of global resources and the easing of the trade war.

We can see that copper has a very good performance on the futures side, and the entire logic of 2019 lies in this place.

After last year's price decline, this year's price is expected to see a year-on-year increase in average price. Moreover, under the current background of long-term copper shortage, once China's infrastructure is built, real estate will also relax, and it is expected to be better.

Therefore, copper's logic is stronger and lasts longer.

Although domestic aluminum price futures have risen recently, they are still at the bottom of a volatile pattern.

The industry-wide losses have not changed now.

The losses of mainstream enterprises and the rigidity of supply have limited the increase in upstream production capacity and increased downstream demand.

Destocking this year is a high probability time, so we must wait until the inflection point of industry inventory and prices occurs.

Once it appears, there will be very large price elasticity.

This logic is more about the reversal of industry difficulties and the reversal of listed company performance.

The Chinese pricing attributes of electrolytic aluminum have not led to significant price fluctuations.

The expected difference and elasticity of electrolytic aluminum are very large. Once the industrial logic changes dramatically, there will be a large market, and the overall price of electrolytic aluminum will fluctuate at the bottom.

Coal has also said before that his logic is not very strong. It is mainly due to the issue of production reduction. The current price is not high and it is still early before the peak season. It mainly depends on the stock valuation. The performance is relatively stable, but the dividend is also very high.

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Looking at the current cyclical resource stocks, many friends will find that they are mostly state-owned enterprises.

Among the resource stocks of these state-owned enterprises, there are Huijin, Securities Finance and Social Security Fund.

Under the guidance of policies, such cyclical resource stocks with state-owned assets background are often the first to appear in the market.

Therefore, when investors invest in cyclical resource stocks, they must pay more attention to observe changes.