Corporate profits are expected to bottom out, long-term investment value of A shares is prominent
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Original title: Long-term investment value of A shares highlights GF Fund Zhang Dongyi’s A-share market in 2019 is an unexpected “big year”. A large number of funds have achieved a return of more than 50%, clearly outperforming the CSI 300.
Looking back on this year, overseas funds have become important incremental funds in the A-share market, and have significantly affected the market’s “aesthetic” preferences, bringing revaluation of the value of advantageous industries and high-quality leaders.
Institutional right to speak against the backdrop of the coexistence of weak global economy and loose liquidity, the trend towards the A-share market in 2019 is “rushing-down-shocking”.
Looking back on 2019, there are several characteristics of A-shares that deserve attention.
First of all, foreign countries are profoundly affecting the A-share investment style.
In 2019, the three major indices of MSCI, FTSE Russell and S & P Dow Jones International have been expanded. Foreign investment has become an important incremental fund in the A-share market. It has become a triad with public offerings and insurance.
Foreign entry significantly affects the market’s “aesthetic” preferences, bringing revaluation of advantageous industries and high-quality leaders, and core assets represented by large consumption continue to outperform the market.
In essence, the structure of the market is significant, and the active money funds have a significant effect on making money.
The structure of the stock market in 2019 is obvious: the dividends of high-quality stocks and inferior stocks are differentiated, and the relative estimated center of superior performance stocks and restructured stocks has moved from 1 to 2 times.
From 2015 to 2018, the structure of A-share investors has undergone profound changes, with individual investors holding 25% of the shares.
2% continued to drop to 19.
6%, institutional voice increased.
The Shanghai and Shenzhen 300 Index is up 36 in 2019.
07%, 623 active equity funds yielded more than 50%, and 5 products yielded more than 100%.
In addition, the science and technology board opened, and capital market reform accelerated.
The easing of liquidity continues to look forward to 2020. The author believes that 2020 will still be a period of easing of liquidity, which will enhance the valuation of risky assets.
Internationally, around 40 countries or regions have cut interest rates since 2019.
Domestically, it is expected that after the inflation pressure eases in the second half of the year, the space for monetary policy may be opened, leading to the downward trend of neutral interest rates.
Generally speaking, it is expected that global liquidity will be loose in the first half of the year and domestic liquidity will be loose in the second half of the year, both of which are expected to improve the estimation of financial assets.
In 2020, the economy will gradually stabilize, and the bottom of the inventory cycle will be superimposed, and the profit trend of the enterprise will bottom out and rebound.
This round of inventory cycle began to replenish inventory from July 2016. The current inventory is at historical low levels and there is little room for downwards.
According to the inventory cycle is about 3-4 years, in 2020, a new replenishment phase will be gradually promoted.
With the rebound of the inventory cycle, PPI may usher in positive growth, and corporate profits are expected to bottom out.
The capital market continues to release reform dividends, and foreign and domestic long-term funds are expected to accelerate into the market.
Under the background of reducing leverage, promoting technological progress, and economic transformation, the capital market has continued to improve.
At the same time, foreign inflows are a long-term logic of megatrends, and domestic long-term funds are accelerated into the market at the same time, accelerating the process of institutionalization of A shares.
Among them, domestic incremental funds include bank wealth management subsidiaries, insurance equity investments, social maintenance pensions, etc.
Consumption leaders have long-term allocation value. As previously stated, 2019 A-shares are a rare “big year” market.
Some investors may still have investment opportunities in equity assets in 2020.
In this regard, the author believes that from the perspective of large-scale asset allocation, A shares are the most cost-effective assets.
Under the keynote of “Do not live in real estate”, the rental return rate of the first-line housing market is from 3 in 2008.
5% is about 1 in 2019.
6%, corresponding to an estimated increase from about 30 times to 62 times.
The current 10-year Treasury yield is about 3.
14%, which is equivalent to 32 times the estimate.
The current A-share is estimated to be only 17 times, which has obvious advantages over other large assets.
From a preliminary comparison point of view, the current overall estimate of A shares is at the historical 30% quantile, and PE estimates for most industries are also below the historical 30% quantile, with high cost 武汉夜生活网 performance. From the perspective of industry configuration, individuals prefer large consumption industries.
With reference to domestic and overseas experience, under the background of A-share institutionalization and continuous inflow of long-term funds, large consumer industries with long-term capital preferences have better investment opportunities.
First, consumption has become the first driving force of economic growth, and the contribution rate of consumption to economic growth has exceeded 60%, much higher than investment and exports.
In essence, the disposable income and per capita consumption expenditure continue to rise, and the trend of consumption upgrade remains unchanged.
In addition, the domestic consumer market has vast space, and the consumer industry has advantages such as stable demand and 无锡夜网 stable cash flow.
Chinese consumption leaders are highly competitive in the world, with high future growth certainty, and the leaders have long-term configuration value. They continue to focus on food and beverage, home appliances, catering and tourism, and medical services.
In addition, there are opportunities in other industries, but in terms of industry and individual stock selection, they need to match their own holding cycle and ability circle to obtain better mid-to-long-term returns.