China’s stock market bubble will not change the upward trend in life insurance category ifeng reported that China’s stock market became a carnival of the feast, the index also rose manic. April 27, the broader market broke through 3800 points. Meanwhile, China’s savings deposits of residents in a large number of flows to the [...]
China’s stock market bubble will not change the upward trend in life insurance category ifeng reported that China’s stock market became a carnival of the feast, the index also rose manic. April 27, the broader market broke through 3800 points. Meanwhile, China’s savings deposits of residents in a large number of flows to the stock market, the first quarter of this year, through the purchase fund and equity funds into the stock market to achieve the number of 100 billion yuan.
The possibility of large Chinese market bubble
Xie recently in Phoenix “social visibility” program that, I think there is a bubble, and to determine when the stock market drop is not one thing, the stock market bubble refers to the increase was mainly resources to move, everyone optimistic; investment depends on your other how are they going to see investors not to judge the company that does well or not, but rather to judge others are into or out of, in this case there will be a bubble in general, so I think that China had 2,500 points after the China’s stock market has entered the era of the bubble into the bubble era, then it can be maintained for a long time, is relatively abundant in capital cases, in the economic cycle, or walk towards a good situation, to say in general will not burst the bubble Therefore, an upward trend in China’s stock market has not changed.
The history of the world’s average price-earnings ratio is about 15 times, the developing countries is lower than this, if faster economic growth, then there is a possibility that price-earnings ratio can be as high as 25%, which are within the scope of rationality, but the is now much higher, although China’s economic growth, but the quality of earnings is not so high, because many companies do not own brand, but also not have their own technology,
For the sustainability of earnings there are certain risks, in this case, China is 25 times price-earnings ratio is a relatively high range, over this range, then very likely to be a kind of speculation, and is a bubble phase, and
On the other hand not only from the point of view the value of the market, how people think about this matter, we are now more and more people catch the rising stock market, he’s afraid to lose, and miss this opportunity.
I have recently come across a driver, said he always felt not keep up with others, he felt that never have a chance, so became a restaurant side dish, and a taxi driver who now have begun to enter the stock market, and this is often a bubble the phenomenon, there has been such a mentality, there are so many people enter a new stock market sentiment so high, the possibility of very large Chinese market bubble.
Chinese stock prices is still too high
Now many companies reported profit growth of about 30%, but many are caused due to injection of the past, there are many who speculate in stocks caused by his own past, such as life insurance company profits rose a lot recently, fifty to sixty per cent because they are bought stock value, so it is profitable, it is also the stock market itself is not even up-cycle.
Broker profit increased significantly recently, which is financial stocks, there are many non-financial companies is also used to purchase the liquidity of its shares, so make a lot of money, in which case, they are profitable growth, in the end how much can be maintained But how many can not be maintained, it is difficult to say.
In the long run, China’s past 20 years, China’s corporate profits are not higher than the GDP, which is in China, a rather special phenomenon, generally the company’s earnings growth is twice the GDP, if the Chinese GDP growth of 10%, profit up 20% of the normal, but in fact not the case, earnings growth is not the same as with the GDP, while the Chinese company’s profit on 10% -12% of that company’s price-earnings ratio, then, and now Chinese companies are price-earnings ratio 25 percent higher than the earnings growth more than doubled, the proportion is two-fold, in the world is also very high, so even with growth and value associated together, then the price of China’s stock market is still too high.
Some people think that the market value compared with the GDP there is a certain gap between stock market growth in the expansion there is the possibility that there is some loophole in China’s domestic stock market is now 13 trillion, in the Hong Kong-listed Chinese companies with Chinese companies do not duplicate there were probably Ê®¶þÈýÍòÒÚ, the words add up to more than 100% of the GDP, and the world average is 100% of the GDP, then the developing country average is 80%, while India is 100% is considered a very high, and Therefore, China’s stock market is already quite large enough, not to mention China’s listed companies are not like other countries, so many from this side, then we can not say China’s stock market is too small as it has been big enough.
Many people think that the stock market rise and China relating to the split share structure reform, is full circulation caused by the past, Andy Xie, a differ ———- published from www.autoinsurancequotes3.com
