Last year, due to the booming stock market, public funds were also booming. More and more young people, born in the 90s and 00s, began to buy funds in the market.
After 90s, Liu Xiangjun showed his income chart to Shenran: he started buying on and off in April and May last year, and invested about 150,000 yuan before and after. During this period, the net value of the fund has been rising. Before the Spring Festival, his book floating profit reached a record. 50,000 yuan.
The feeling of lying down and making money is great. He doesn’t understand funds, and he doesn’t know which stocks these funds have bought. Anyway, he “buy blindly, and buy a few thousand if it’s pleasing to the eye”.
There are not a few people like him who enter the market in a silly way and make money easily. According to data from the Mob Research Institute, in the first half of 2020 alone, China’s new Christians exceeded 20 million, and about half of them were born in the 90s under 30. In 2020, the average return rate of Chinese public funds is 45%. This means that the vast majority of people who enter the market have made money.
Young people who have tasted the sweetness are very enthusiastic. E Fund’s star fund manager Zhang Kun was enthusiastically praised, and a large group of young Christians established a fan support group on January 26, playing for Zhang Kun like a star, and Zhang Kun ascended to the altar.
But only half a month later, after the Spring Festival, the market took a turn for the worse. In just a few trading days, the net value of a fund managed by Zhang Kun dropped by 10%. All the new Christians who chased after the high and entered the market a year ago were all buried. Many people’s attitudes turned around one hundred and eighty degrees in an instant, and voices of questioning, verbal abuse and even defamation appeared.
For many investors, the fund bull market that began last year is a good time to make money in financial investment. The continuous money-making effect attracted a large number of noobs to enter the market. A 70-year-old man who retired at home and a 20-year-old student who just went to college started to consult about the fund. There is a nationwide “speculation” fever.
What is worrying is that many young people who have just entered society invest hundreds of thousands of yuan to buy funds, but they don’t know anything about funds. They follow venture capital, frequently operate, chase the rise and fall, and speculate in funds like stocks. Know whose money you are making and why you are losing money. They are young, impulsive, and emotional. Today they are wild stock gods, and tomorrow they are strong leek.
“China’s capital market is short and long. It takes a long time to digest the pain, and it takes time for new leeks to grow. History is always repeating itself. Each session of leeks thinks they are different, but in fact there is nothing. It’s different,” said a person in charge of a fund company with more than 20 years of experience to Shen Ran.
The beginning of the story is beautiful, but this may be an exaggerated feast of wealth.
The beginning of the story: young people, financial management and the dream of getting rich
Funds began to arouse discussions among the people. In fact, in the second half of 2020, the most intuitive phenomenon is that the newly released funds have sold out.
Public offerings are financial products sold by fund companies, and public offerings are public fundraising for the public. According to different investment directions, funds can be divided into currency funds, stock funds, bond funds, etc. The most popular in 2020 are stock funds, that is, those funds that trade in stocks. When you buy a fund, you become a fund holder, commonly known as the “Kimmin”.
Fund managers take the Citizens to speculate in stocks, make money together and lose money together, which is the basic model of this business.
In the first week of the second half of 2020, the first “Sunlight Base” was born (funding was completed on the day of sale)-China Universal Mid-Cap Value Select Hybrid Fund, which raised more than 30 billion yuan on the same day.
Two days later, the Penghua Ingenious Select Hybrid Fund, co-led by Jinniu Fund Manager Wang Zong, planned to raise 30 billion yuan. As a result, it subscribed more than 70 billion in the morning and 135.7 billion in the same day, setting a historical record.
This record has not been broken throughout 2020 until the fund company Yi Fangda, which is sought after by fans, makes a move. On January 18, 2021, E Fund’s competitive advantage corporate fund was issued, and the subscription amount reached 237.4 billion yuan on that day, setting the highest subscription record in the history of public funds.
It was at this time that public offering funds “out of the circle”, and it exploded among young people. The “fan circle” invaded and formed a global support club for Zhang Kun, the star fund manager of E Fund, on Weibo. Zhang Kun is regarded as a new generation of koi, and his head is made into posters.
Source / network
Everyone involved has a dream of getting rich in their hearts. Liu Xiangjun is one of the first people to start dreaming.
Liu Xiangjun is the kind of person who “knows that financial management is very important, but doesn’t know how to manage money.” In the past, he put his money in Yu’e Bao, but later found that the rate of return was getting lower and lower. Thousands, only earning dozens of yuan a month, it’s not worth it.
His starting point for “raising the foundation” is very simple-“One day he found out that a fund he joined two years ago had risen by 200%.” The fund he looked at at the time was another consumer fund under China Universal Asset Management mentioned above.
He started to buy various top-ranked funds in May last year, and bought 22 funds in total, buying tens of thousands of dollars every month. Apart from being able to understand the daily profit and loss, “I don’t understand other things. ”
But he caught up with a good time. When he entered the market, the 100 billion subscription of Penghua Ingenuity Fund did not appear until two months later, and most of the big fund companies’ explosive “sun base” appeared in the second half of the year. From May to the Spring Festival of 2021 (mid-February), the A-share ChiNext index rose by 60%, and the yields of many funds also rose by about 30%. When the Spring Festival came, he chose to “hold the base for the New Year” and did not sell the profit. At that time, the book profit was more than 50,000 yuan.
Just like before the banquet, it always starts with dessert. Those who have tasted the sweetness began to rush to tell, “I bought a fund to make money”, which has become a daily meal and after-dinner talk for many people.
In some fund discussion forums on the Internet, information about blind dates and marriages began to appear. The topics asked by both men and women have changed from house and car to the type of fund held and the rate of return. In the discussion forums of funds with high cumulative yields such as liquor, medicine, and new energy, the comment area has the most marriage news.
This seemingly hot atmosphere and the huge money-making effect have activated the dream of young people to become rich overnight. They ran into the arena with money and full of enthusiasm.
The last round of such a hot fund market was in 2007. A media person who used to be the host of a financial program on a local TV station, Xiang Shenran recalled that every time the program was broadcast, he would report a number-the number of new Christians that day. Because the market is too hot, too many people open new accounts every day. This is very similar to the situation today.
Jiang Weijun, chairman of Dajiang Hongliu Asset Management Co., Ltd., has been in business for more than 20 years. He told Shenran that in 2008, he served as the director of a research institute in a securities company. People invited him to dinner, “The main reason is to share the joy, and I have made money. I will tell you as soon as possible.” In that round of bull market, the A-share stock index rose from 998 points to 6124 points, a 6-fold increase in more than two years.
The clock is set to 2020. Last year, the yields of many funds soared. Now many people believe that a bull market similar to that of 2007 is coming again.
After the 90s, Zhao Yunjing started to buy funds because suddenly one day, he received a pop-up window of Alipay’s fund notification on his mobile phone. Following the link to enter the fund page, he found that many of the top funds have return rates of more than 100%, while Yu’ebao’s return rate has fallen below 2%.
At that time, he had heard about fund income from friends during more than one dinner. In the subway passage on the way to work, on the TV screen of the elevator in the community, he had seen many fund advertisements, and even once when he was posting a short video. He also caught the live broadcast of the fund manager. In order to promote one of its livestock breeding funds, Ping An Fund brought a piglet in the live broadcast room.
Alipay and QQ Music Licaitong, a sales channel for C-end users, greatly improved the convenience for ordinary people to buy funds. In the past, people had to go to the bank to buy funds, or through stock trading software, but now they can buy it at will when they turn on their mobile phones, and there is no limit on the amount of money, hundreds of thousands of dollars can enter the market.
Hu Bo, vice president of Yingli Securities, told Shenran that he can clearly feel that the funds on the Yingli Intelligent Investment platform are selling much better than before. “Many customers will take the initiative to choose funds.”
Tiger Securities, a US and Hong Kong stock brokerage, told Shenzhen Ransom that since last year, many investors began to pay attention to funds. During the Spring Festival of 2021, Tiger Fund supermarket stock AUM (asset management scale) reached the level of 330% at the end of Q3 last year, doubled from the end of Q3 to the end of the year, and doubled again after the Spring Festival from the level at the end of 2020.
Before the Spring Festival, the fund is accelerating its teamwork. A steady stream of capital blessings has allowed those companies with heavy positions in funds to obtain continuous liquidity, which in turn promotes stock prices to continue to rise. Hu Boxiang analyzed that there is a positive correlation between fund grouping and the existence of the market, and they are mutual cause and effect. “From the perspective of a fund manager, it’s very simple. I manage a 5 billion fund. You can’t buy small-cap stocks. You can only buy some large-cap tickets, and it’s long-term.”
On some community apps and short video platforms, some big V and some short video creators began to export fund science knowledge, expose fund income, and guide fans to buy funds. Videos such as “College Students Buying Funds with a Monthly Income of Thousands” and “Student Party Financial Management Practice” are very common. These wild “fund gods” use semi-professional interpretations and unverifiable income charts to attract Xiaobai to the market and fuel the already hot fund market.
Jiang Weijun believes that China has entered an era of capital. After the per capita GDP exceeds 10,000 US dollars, everyone has surplus money in their hands, investment has become a rigid need, and buying funds has become a popular culture.
“It’s not like Bitcoin is just a niche group playing, but everyone can see it and talk about it. Just like many people drink coffee, if you don’t drink it, you refuse to drink, and it’s nothing to you. It’s good because everyone else can drink it, and it can add value.” In addition, fund managers have celebrity effects, have IPs, have fans, can have relationships with people, and can spread, so the scale effect is obvious.
Compared to 2007, even though funds are hot now, fund manager fan support groups are still a novelty. Hu Bo believes that in 2007, TV newspapers were the main channel for people to obtain information, and online advertising was not the mainstream, but now the forms of media communication and interaction have changed. Not only are channels more diverse and more scattered, but also more interactive. “In this era of pan-entertainment, it is not the financial industry that has changed, but the entire media industry.”
Who made my money away?
When Zhao Yunjing bought the first fund through Alipay, it was the days when Zhang Kun was popularized by fan support groups. He bought the popular China Merchants China Securities Liquor Fund and invested 20,000 yuan.
Unexpectedly, after the Spring Festival, the stock market plummeted. Since the market opened on February 18, for more than a week, the high valuation sector led by liquor has continued to fall, and Zhao Yunjing has lost nearly two thousand yuan. Years ago, after the fund rose, he sold a little bit. When the fund fell after the year, he added a position, but sold it again two days later.
He didn’t know what happened, he only knew that his money was gone, and he was panicked, “I feel like I was cheated.” Those who posted profits on the Internet, including friends who made money from buying funds, looked like fakes.
Jiang Weijun, who has experienced many rounds of bull-bear conversion, can understand Zhao Yunjing’s feelings well. He met an investor. Once this person participated in a radio show. The host asked, “What is your most memorable number?” Some people said it was his birthday, and some said it was his wife’s birthday. This person said a list of stocks. Code. He said: “This number has poured all the honor, hard work, emotions and, of course, money in my entire life. Now, as long as I hear this number, I will be shaking all over.”
“In the investment process, extreme goodness will definitely bring extreme badness. Many people can’t bear this kind of volatility. Most people can’t pass this level. Even if you buy funds, buy at the highest point and sell at the lowest point. This is the main reason why many retail investors lose money.” Jiang Weijun said.
Buying funds to lose money is often not because of the fund, but because of the timing or method of participating in fund transactions.
According to Wind data, the average increase of 535 stock funds that can be counted across the market in 2020 is more than 43.92%, but the yields of many Christians are far below this level, or even loss. This shows that during the process, the Citizens did not hold for a long time and frequently reverse operations, which led to underperform the average return of the fund.
Buying funds is different from buying stocks and trust products. Fund buying is actually a semi-entrusted relationship. In Jiang Weijun’s view, it is irresponsible to scold fund managers after buying public funds or index funds after losing money. “Stock funds have a minimum position limit. Some public funds have industry restrictions and tendencies. Investors need to make their own position and industry choices. You can’t half-entrust to a public fund and let the public fund assume the responsibility of fully entrusted. This is a public fund. The main difference with private equity funds.”
I can’t control my own hands. This is an important reason why fund companies have made a profit, but some Christians have suffered miserable losses.
Source / Unsplash
Hong Liu, the investment director of Harvest Fund with 21 years of securities industry experience and 10 years of investment experience, told Shenran that what a fund manager does is to buy the best assets and make long-term allocations instead of frequent trading every day. Some investors are seriously wrong to speculate funds as stocks. When communicating with Shenzhen Burns, the Harvest Competitive Optimal Hybrid Fund, led by Torrent, just launched its sale on February 22, with a fundraising limit of 8 billion yuan. As a result, the total market subscription amount exceeded 36 billion yuan in one day.
Hongliu further analyzed that the handling fee of the fund is very high. If the investor sells it within 7 days after the purchase, he will have to pay a redemption fee of 1.5%, but many ordinary people do not know it. “Buying funds is actually buying fund management companies and fund managers. Don’t think of it as an online celebrity market. Frequent trading cycles and trading frequencies will make you lose a lot of holding opportunities.”
Many newcomers who have followed the trend obviously haven’t figured this out yet. What they see is the halo of the Internet celebrity, the enviable income graph, and the overnight richness in the mouth of others. But the market cannot keep rising.
“If the market keeps going up, whoever makes money? You make money from ordinary retail investors who are crazy to buy funds later.” Hongliu said.
Jiang Weijun gave an example to Shen Ran. Young people buying funds are like watching idol dramas, and all they see are sweet words, but what we are thinking is whether the relationship can last in the most difficult time. In his investment career, the market fell more than 50% when the market was the most volatile. At the end of the bull market in 2008, the entire market fell by 66%, and the fund fell by an average of 72%, but even so, those who hold it so far have reached a new high.
“The current increase is very good, but this is the stage of idol dramas. What I am thinking about is what should I do when the firewood, rice, oil and salt can’t make it through? It is activated through the sweet part, so everyone sees the money-making effect, but it is a bittersweet. There is a process, this is the cruel and true phenomenon.”
The front-line fund managers face the fluctuations of the market every day and face the trust of investors and bear the greatest psychological pressure.
Hongliu told Shenran about his daily work as a fund manager, and the things that take up the most time in a day are not market-watching and trading, but long-term in-depth research, various surveys and roadshows. Off work