Chapter 217: The Biggest Drop in a Single Day
"There will be a big drop today." Gu Junhao said while looking at the screen. Not to mention how individual stocks performed, the unilateral downward trend of the ChiNext Index has not appeared for a long time.
"We should buy at the bottom today, right, boss?" Wang Ruoyu looked at Gu Junhao and asked.
"That's right. I've been waiting for this opportunity for so many days." Gu Junhao nodded. Although Dongfang Wealth has now risen above the flat price, today's trend is irreversible.
The first half hour of the morning trading was an opportunity for those short-term funds that had bottomed out yesterday to escape. Compared with Yinzhijie and Tonghuashun, which fell as soon as they opened, public funds were relatively generous.
At midday close, the ChiNext Index closed at 1515.79 points, down 0.66%. The ChiNext Index did not fall below the 1500-point mark in the morning. The Shanghai Composite Index fell as much as 0.84% in the morning, but rebounded at noon to 2340.95 points, up 0.08%.
Tonghuashun closed at 24.30 yuan, down 2.26%; Yinzhijie closed at 23.63 yuan, down 4.22%. Among the several holdings, his decline was the largest. Calculated at the flat price of 25.45 yuan in two trading days, the retracement was close to 8%.
Dongfang Wealth reported 13.75 yuan, up 1.33%. However, during the rise from a drop of 0.8% to an increase of 1.33%, the trading volume was extremely scarce.
As the ChiNext Index continues to be sluggish, Gu Junhao believes that Dongfang Fortune may still fall in the afternoon. The volume will decrease when it rises and increase when it falls. This is the performance of Dongfang Fortune in the morning.
In the morning's trading, Gu Junhao underestimated the trading volume of Yin Zhijie, but he made timely adjustments, and Xu Jianqing basically took back the chips he sold in the morning.
I didn’t make any money, but I didn’t lose any money either. In Gu Junhao’s opinion, it was a good thing that I didn’t lose the chips.
"It seems that we should trade less stocks with daily trading volume of around 100 million yuan or less in the future." Gu Junhao also said to Xu Jianqing during lunch.
Xu Jianqing loves trading, and under the influence of this passion, he may sometimes ignore the trading volume of stocks. If he just casually buys tens of thousands or hundreds of thousands of stocks, the trading volume is not particularly important.
However, Gu Junhao would not allow this to happen. Institutions are not retail investors. There is no need to do meaningless and time-wasting things. The mission of institutions is to make money, not to trade for fun.
Xu Jianqing also nodded quickly. To be honest, he was also shocked by the morning's transaction. Among Junshi No. 1's current holdings, Yinzhijie is the number one heavily held stock. The sharp drop in heavily held stocks can easily affect the mood of rookies.
However, it doesn’t matter to Gu Junhao. The adjustments of Yinzhijie in the past two trading days have been somewhat drastic, but for a stock with low trading volume, it is actually a good thing.
What I am afraid of is that the market will fall sharply like it did some time ago, which would be the most despairing.
Today is only Tuesday, but the volatility this morning has been so great. There are two new stocks to be subscribed on Thursday, and Friday is the stock index settlement day. It seems that this week's trading will not be peaceful, and today's market is a reaction to this.
However, all of these are just excuses for the decline. Before the ChiNext's sharp drop this morning, the Shanghai and Shenzhen stock markets had already shown a short-term peaking trend several trading days ago.
The big financial stocks representing the weight did not perform well. The same was true for Tonghuashun and Dongfang Wealth, which represent the recent profit-taking of small and medium-sized enterprises. As is the practice of A-shares, when they cannot be pulled up, they will pull up the steel, coal, oil and other sectors.
All of this sends a signal to investors that the market has reached its peak. All coincidences have their inevitability, and the same is true for the stock market.
After lunch, Xu Jianqing did not seem as energetic as before, but quietly went to take a nap. Gu Junhao looked at Xu Jianqing walking away in surprise, and said to Wang Ruoyu and Liu Tingting with a smile: "This guy was scared this morning, haha."
However, this is just the beginning. He has not yet seen thousands of stocks hitting the limit down. However, it is a good thing to have this kind of fear. Only by respecting the market can one grow. Gu Junhao himself has gone through this.
In the afternoon, trading continued, the ChiNext Index continued its unilateral downward trend, and the Shanghai Composite Index continued to fluctuate around 2339 points as in the morning, and the index remained in the red stage.
Dongfang Fortune fell below the opening price in the afternoon, and continued to decline as Gu Junhao expected; however, compared with the shareholders of Tong Huashun, the holders of Dongfang Fortune are much happier.
At least, Dongfang Wealth is still in the red. If you are really scared, you can sell it for intraday profit.
At 13:17, the Shanghai Composite Index once again came to around 2347 points, and market sentiment seemed to be reignited; however, before everyone had time to react, the index plunged sharply.
The media and education, electronics, and machinery manufacturing sectors fell rapidly, and the automobile sector, which performed poorly in the morning, rapidly widened its losses, with more than half of the related stocks falling by more than 5%.
"Huh? It plunged?" Gu Junhao said with a smile as he looked at the green fonts flashing on the Short-Term Elf on the big screen.
A large number of individual stocks are showing heavy selling. Yinzhijie also fell below the intraday yellow moving average price again, with the decline widening to more than 5%. Dongfang Wealth's share price returned to below 13.70 yuan again, closing at 13.65 yuan.
At 13:30, the Shanghai Composite Index turned green, and the ChiNext Index returned to around 1500 points, closing at 1505.30 points. Small and medium-sized start-up stocks plunged sharply, and Dongfang Wealth also returned to the flat price.
"Be prepared, the big drop is coming." Gu Junhao said calmly to the three people.
The Shanghai Composite Index did not break its intraday high and then plunged, and small and medium-sized enterprises continued to fall sharply. Today's market situation is irreversible; and this is exactly the opportunity that Gu Junhao has been waiting for for a long time.
Adjustments in a bull market are always so intense, with the market plummeting in one day. This was not uncommon in 2015, and even in the middle and late stages, adjustments could be completed directly during the trading session.
The more bullish the market is, the more brutal the market cleansing will be. In a market that has been rising for many consecutive days, the profit taking is quite heavy and most investors want to lock in their profits.
Once the market performs poorly after several consecutive days of adjustment, it will cause panic selling, resulting in a trend of large negative lines with large volume.
The faster the stock rises in the early stage, the more fierce the crash will be. Take today's Yin Zhijie for example. Today's trading price of Yin Zhijie can be described as extremely dangerous.
The decline has now expanded to more than 6%, giving the impression that the stock will hit the limit down today. How many investors can hold on to their shares?
As for the investors who have just entered the market recently, they are even more at a loss at this moment.
Many people do not suffer much loss in a bear market. On the contrary, most of the losses are caused in the bull market.
At 13:45, the ChiNext Index fell below 1500 points to 1449.63 points, down 1.74%. Dongfang Wealth reported 13.42 yuan, setting a new low for the day.
The trading room was extremely quiet. Except for Gu Junhao who was able to remain calm, the other three people's breathing became heavier. They had never witnessed such a brutal trend during an uptrend.
"Don't panic, this trend will appear frequently in the future." Gu Junhao smiled as he looked at the three people who were a little nervous.
"Boss, why aren't you panicking at all? We must have lost a lot today." Xu Jianqing looked at Gu Junhao and said. He also learned the word "lost a lot" from Gu Junhao.
Unconsciously, some of Gu Junhao's vocabulary, which was more advanced than today's, had deeply influenced the three of them.
“Don’t worry about the intraday trend, look at the long-term.” Gu Junhao said, and then asked Xu Jianqing to call up Yin Zhijie’s trend and analyzed it to the three people: “Look at Yin Zhijie’s trend.
"From the daily chart, Yinzhijie's trend is still in a bullish trend. Although the stock price fell below the five-day line, it did not break the ten-day line, right?"
Xu Jianqing nodded quickly, and the ten-day line price was about to reach the limit price of Yin Zhijie; then, under the instruction of Gu Junhao, he adjusted the weekly trend of Yin Zhijie.
Gu Junhao continued, "Looking at the weekly chart, it has been rising for three consecutive weeks. Even if it fell sharply this week, it is just a normal correction, not to mention the monthly chart."
"The expectation for Yinzhijie's restructuring is still there, and the expectation for his performance reversal is also there. As long as the expectations and the bullish trend have not changed, he will not be in any danger."
Afterwards, Gu Junhao said with some regret: "It's a pity that our positions are too high, otherwise today would be a good opportunity, a good opportunity to increase our positions."
At 2 p.m., the Shanghai and Shenzhen stock markets further widened their losses, the three major indexes continued to fall, and Dongfang Wealth also continued to refresh its intraday lows. At 14:05, Dongfang Wealth reported 13.31 yuan, a drop of nearly 2%.
"The opportunity has come, Ruoyu, be prepared." Gu Junhao said with a smile. With the Shanghai Composite Index continuing to plunge, the miracle at 2:30 is unlikely to happen.
On the contrary, if the miracle at 2:30 does not happen, the market may be near the intraday low of the whole day during that period. Without a miracle, there will be a collapse.
Time passed by second by second as he waited. At 14:17, the trading volume of Dongfang Wealth began to increase and the stock price fell rapidly. Gu Junhao took a look at the ChiNext Index: 1490.75.
"Get ready to start, buy all below 13.18 yuan." Although the purchase price during a rapid decline may be higher than the closing price, the cost of building a position will be greatly increased, but the volume is large, so buying is much more convenient.
Based on the existing amount of funds, Dongfang Wealth must have bought more than 8,000 lots. For such a large order, the price to take over must be higher than that of ordinary investors who buy dozens or hundreds of lots.
At 13.22, the price of Dongfang Fortune fell from 13.22 yuan to 13.16 yuan. Wang Ruoyu officially started buying, and the first order had been executed, with 1,398 lots and a transaction price of 13.16 yuan.
One minute later, the ChiNext Index fell by 2.87%, and the Shanghai Composite Index fell below 2,300 points, accelerating the panic. Countless stocks on the market fell rapidly, but Dongfang Wealth's stock price did not hit a new low again.
13.14 yuan was the low point of Dongfang Wealth during this period. Perhaps Wang Ruoyu’s large purchase also played a certain role in boosting the stock price.
At 2:30 p.m., when the three major indexes continued to expand their losses, Dongfang Wealth rose to 13.29 yuan, and Wang Ruoyu also suspended buying.
The panic decline in the two markets and the shrinking volume of Dongfang Wealth's rebound were all seen by Gu Junhao.
"The price will continue to fall in the last half hour. How much is left to buy?" Gu Junhao asked Wang Ruoyu.
"I bought more than 4,200 lots at the price of 13.16 yuan, and there is about 6 million yuan of funds left." Wang Ruoyu replied. Xu Jianqing made a small profit by doing T in the past few days, and the amount of funds also increased by hundreds of thousands of yuan.
"6 million, not much left, let's buy it near the call auction." Although Dongfang Wealth, which rose to around 14.29 yuan, continued to fall back, the trading volume was still too small, and the amount just bought was already quite a lot.
Gu Junhao also did not want to arouse market vigilance when the trading volume was small; the sense of smell of big funds should not be underestimated; this can be seen from the fact that Dongfang Wealth fell before the ChiNext Index.
At 14:45, Dongfang Wealth returned to the price of 13.19 yuan. The Shanghai Composite Index continued to fluctuate around 2290 points, and the decline of the ChiNext Index also tended to stabilize.
At this point, the ChiNext Index, which had been declining unilaterally throughout the day, and the Shanghai Composite Index, which had plunged sharply in the afternoon, have finally stabilized.
At 14:56, Dongfang Wealth reported 13.07 yuan. The lowest price of the day was also created during the decline during this period, 13.02 yuan, just stopping above the integer mark of 13 yuan.
Gu Junhao asked Wang Ruoyu to deposit all the funds and place an order at 13.08 yuan without splitting the order.
At 15:00, Dongfang Wealth's bidding showed that 12,016 lots were traded, and the stock price closed at 13.03 yuan. Wang Ruoyu's 4,600 lots were also successfully traded. From 2:30 p.m. before the plunge to the closing, a total of 8,800 lots were bought.
The average transaction price remained at 13.09 yuan, which was lower than Gu Junhao's expected purchase price. Gu Junhao seemed very satisfied with this price and chips.
At this point, except for Wan'an Technology, the holdings of the three major holdings of Junshi No. 1 are all greater than 10,000 lots. Dongfang Wealth holds 17,200 lots, Xibu Securities holds 12,800 lots, and Yinzhijie holds 11,000 lots.
The position has also returned to the full position state. Although it is necessary to adjust the trading mode and no longer continue to operate with a full position; however, with a big drop like today, the opportunity to adjust in place at one time is still relatively rare, so the full position should be operated.
Today, both markets saw a large drop in volume. The Shanghai Composite Index recorded the largest single-day drop in nearly six months with a turnover of 237.7 billion yuan, 42 points and a drop of 1.82%. The turnover of more than 200 billion yuan also shocked the two markets.
The ChiNext Index also fell in large volume, with a turnover of 49.89 billion yuan, a sharp drop of 3.47%. The Shanghai Composite Index broke through 2,300 points to 2,296.55 points, and the ChiNext Index broke through 1,500 points to 1,473.13 points.
More than 2,100 stocks in the two markets fell, and many of them fell by more than 5%. Gu Junhao held two of the stocks, with Tonghuashun falling 6.07% and Yinzhijie falling 7.17%.
The other three stocks also suffered significant declines, with Dongfang Wealth falling 3.98%, Xibu Securities plummeting 3.11%, and Wan'an Technology also falling 4.81%.
All four holdings ended up with a sharp drop, with a daily net loss of 2.4178 million yuan, which also created the largest single-day loss for Junshi No. 1 since its establishment. Even the 8,800 lots of Dongfang Wealth that were bought at the bottom at the end were in a daily loss.
The decline within one day almost completely offset all the gains last week, and Junshi No. 1 also returned to below 70 million yuan with a total scale of 69.0846 million yuan.
This is the consequence of not reducing positions at high levels.
"Oh my! Today our fund lost the value of a house in one day." Xu Jianqing exclaimed after the market closed. After listening to the boss's advice, Xu Jianqing has been paying attention to houses recently and has become more sensitive to housing prices.
"Yeah, the drop is indeed quite severe. Fortunately, today is not Friday, so there is no need to announce it. Haha." Gu Junhao said nonchalantly. It was all profit anyway, and it was not like the money could not be recovered.
However, today the three major indexes and the vast majority of individual stocks are all large negative bars with large volume. Even stocks like Wan'an Technology, which no one cares about, have a trading volume of more than 40 million yuan today.
The real Black Tuesday made investors in the market deeply feel the cruelty of the stock market, and also taught a profound lesson to the three new traders of Junshi Capital.
Of course, the reason for the sharp drop in Junshi No. 1 today lies more with Gu Junhao. The index adjustments in June and July were also relatively large, but since they had reduced their positions very early and the overall size of the fund was not as high as it is now, the three of them did not have a deep understanding of it.
Today, as much as 85% of the positions caught up with the big drop. Unintentionally, it can be regarded as a lesson for the three of them from my big A, teaching everyone how to be a human being.
"Okay, just adjust normally. Don't be so dejected. Think about it from another perspective. It's a good thing to adjust within a day." Seeing that the three of them were in a low mood, Gu Junhao also spoke out to comfort them.
However, what Gu Junhao said is true. Today, the two markets fell below the five-day line and the ten-day line in succession, and are infinitely close to the 20-day line. Before there are major systemic risks in the market, they will go sideways near the 20-day line for a few trading days. I believe the two markets will be able to stand up again.
Today's adjustment far exceeded Gu Junhao's expectations, but this beyond-expectation is a good expectation, much better than those continuous declines. The only pity is that there is no chance to buy back Tong Huashun.
However, Tonghuashun has fallen below the big positive line on August 22, and the breakdown trend has officially formed. In the case of today's unclear volume increase, adjustments are still expected in the short term, so there is no need to rush to buy.
The long-term positive trend has been broken, and seeking a new support point downward is what every stock that adjusts from a high level must go through. Tong Huashun is no exception. In Gu Junhao's view, the next support point may be the starting point of the previous round.
After get off work, Gu Junhao returned home. Today's sharp drop did not affect Gu Junhao's mood, which was still the same as usual. However, after Gu Junhao finished dinner, he sat in front of the computer again.
When Gu Junhao picked up his phone to check the information, he saw a message from Wang Ruoyu in the four-person group of the Fund Business Department: "Boss, Dongfang Wealth has been suspended."
"Suspended trading? What the hell?" Gu Junhao was a little surprised when he saw the news. He did not open the link sent by Wang Ruoyu on his mobile phone, but turned on the computer to check Dongfang Wealth's announcement today.
Opening the stock column of Dongfang Wealth, a new announcement indeed appeared in the announcement area. Dongfang Wealth was planning equity incentive matters. After applying to the Shenzhen Stock Exchange, the company's stock was suspended from the opening of the market on the morning of September 17, 2014 (Wednesday).
"They have to suspend trading for such a trivial matter? Is this intentional?" Gu Junhao said speechlessly. He did know that Dongfang Wealth had something about equity incentives before, but based on his later thinking, Gu Junhao did not think about the suspension of trading.
Article 2 of the Principles for Suspension and Resumption of Listed Company Stocks stipulates that listed companies should suspend trading prudently, with the principles of no suspension, short-term suspension, and intermittent suspension.
Although equity incentives are considered major matters for listed companies, there is no need to suspend trading. There is no need to suspend trading if it does not involve major asset restructuring or business changes.
"Is this because they are afraid that the chips will be dispersed due to continuous declines? Or are they afraid that retail investors will buy too much at the bottom?" Gu Junhao couldn't help but think, it is not uncommon for listed companies to use announcements to cooperate with major funds in this era.
Fortunately, I did not hesitate today and bought in at the end of the trading day. It is better to stay inside than to wait outside. This suspension, which is not a big deal, should not last long. It may be released in one or two days at the earliest and next week at the latest.
However, the suspension of Dongfang Wealth did serve as a reminder to Gu Junhao. According to the specific response time that Yin Zhijie gave to the China Securities Regulatory Commission, a response must be given between the 25th and the end of this month.
Dongfang Wealth took advantage of the suspension rules for such a trivial matter. Stocks like Yinzhijie, which involve major asset restructuring, will definitely also take advantage of the suspension rules and the sharp drop in the Shanghai and Shenzhen stock indices to clean up the market.
Looking at the two big negative lines of Yin Zhijie, Gu Junhao seemed to be thinking about something. He seemed to understand why Yin Zhijie had been washing the market so fiercely in the past two days.
"If nothing unexpected happens, Yin Zhijie will also be suspended within this week."
After turning off the computer, Gu Junhao muttered to himself. When he thought about the continuous suspension of trading of several stocks in his portfolio within a week, Gu Junhao also laughed. There was also Xibu Securities behind him, and he didn't know whether its stock would also be suspended.
The stock market in 2014 was so interesting, with lax rules and regulations.
