Why are retail investors called leeks?
When it comes to the stock market, we often mention the word "leek" to describe the retail investors who lose money in stock trading. In the stock market, cutting leeks means that retail investors suffer losses because of limited timing of stock selection, lagging news and being harvested by bookmakers.
Generally, when the stock market skyrockets, leeks are in a period of vigorous growth. For example, A shares soared, and the number of weekly accounts opened by brokers increased by 53%. With the rise of the stock market, not only the number of retail investors has increased, but no matter how much money is harvested, leeks are full of confidence, and the waves are higher than the waves. For example, a large number of major shareholders reduce their holdings every day.
Generally, there are bookmakers, hot money and institutions (private equity funds, Public Offering of Fund, national teams, social security funds, etc. ), but now it is not as much as before, mainly hot money. Take Ma Yongwei, a "hot money harvester", as an example;
It took several traders to find hundreds of stock accounts in Jiangnan provinces and attacked many stocks. The selected stocks are relatively unpopular, with a small total share capital and a circulating market value of less than 3 billion.
First of all, hot money is raised at a low cost and quietly opened a position. Pull up at a certain time, use the controlled stock account to reverse, create the illusion of active stock trading, and guide retail investors to follow up.
At the close of the stock price, hot money continued to apply for buying at the daily limit, strengthening the trend of daily limit at the end of the session and inducing retail investors to follow suit. In the shipping stage, hot money used false declarations to incite the daily limit to complete the shipment. When retail investors "took over", a large number of retail investors were locked in a high position.
Generally speaking, the stock market is a game market. Retail investors have no financial advantage or information advantage, and all aspects are disadvantages. If you don't know enough about the company, at least choose stocks with excellent performance or invest in index funds, otherwise it will be easy to suffer.
Ok, the topic of retail leek is here, I hope it will inspire everyone. Warm reminder, the stock market is risky and investment needs to be cautious.
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