Old man's days are getting better too

Today saw a broad rally; happiness belongs to everyone. The 'old guards' led the gains, while the 'newbies' saw slight declines. The median for the A-share market rose by 1.57%, with 4,253 stocks up and only 1,215 waiting to rise.

I heard many people say their single-month returns in July set a record for this year. Looking at it, it's just like me—getting thrashed in the previous months.

This month, no one looks down on value investors anymore; it's all about cycles. From a monthly gain perspective, the once-popular chip and semiconductor sector, often mocked as 'newbie territory,' has retraced over 30% this month.

Insurance, consumer goods, banks, baijiu (liquor), and pension sectors—the 'old guards'—all rose by around 10% this month. We finally don't need to triple-down on household chores [metaphor for boring/stable plays].

Writing this, I suddenly remembered a data point I saw today: retail investor activity dropped significantly, with many staying away completely after losses. Actually, I'm quite curious to know how many people around you have truly clicked 'clear all positions' and stopped participating entirely.

The Hong Kong market has been performing well recently. After the previous deep pit, $Bosera Hang Seng Health Care ETF(QDII)(513060.SH) bounced back 11% this month, and Hang Seng Tech rebounded 9%. Especially Hang Seng Tech, which rose 5.08% this week, showing strong momentum lately. Xiaomi has unknowingly risen 50% from its bottom.

Regarding the HK IPO side, what everyone is most concerned about today is the grey market trading of $ZJ INNOLIGHT(03308.HK). Yesterday, the A-share counterpart fell 15%, scaring everyone silly. After all, one lot is 50k; a 10% drawdown is still 5k. If you add another tier and hold 6 lots, that's 30k gone. Anyone would be panicked.

The grey market was quite supportive today, offering a chance to break even. The issue price was 980, and the grey market touched 980.5 intraday. Breaking even means only paying a 1.0085% subscription fee, which is 500 yuan. It's a relief to land safely after being on edge.

HK new listings should hurry up and bring in some new inventory. Waiting anxiously is too hard to bear; there are currently 6 companies that have passed the hearing stage.

The KOSPI has continued to fall. Since the high point on June 19th, it has been in a drawdown for 40 days. As of today, the KOSPI has retraced 40%. Keep in mind, this is the broad market index.

Some might argue that even with such a drawdown, the KOSPI is still up 34% for the year. But putting myself in the shoes of an ordinary Korean person, I usually don't care about SK Hynix. Seeing people around me going to KTV every day makes it hard not to be tempted. Those who entered at high levels, or those who made profits but gave them back, are not few.

If we're talking about excitement, it has to be the 2x leveraged SK Hynix $SK Hynix(SKHY.US), which dropped from 193 to 32, a drawdown of 84%. This is the largest drawdown I've personally experienced. The story of the 'Korean girls' is past; next, we'll see if it's the 'Hong Kong boys.'

Last night, the US chip sector plummeted. The Philadelphia Semiconductor Index fell 4.49%, having retraced 25% from its highs, technically entering a bear market. Like our A-shares, when chips fall, the 'old guards' rise, and the SaaS sector sees a broad rally.

US stock indices continue to oscillate. The strategy that suits me best in the US market remains the dumbest one: index dollar-cost averaging and small-position grid trading on large-cap stocks, including both 'old guards' and 'newbies.' The core is keeping positions small, so no matter how you play, you feel secure.

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