On July 23, 2020, the 3rd Oceanpine Capital Investment Salon Series "The Opportunities and Challenges in New Economy Investing under Bull Market" was successfully completed.
The Salon in China Century building was a sell-out. We invited three heavyweight keynotes speakers—Mr. Fan Bao, the Chairman of China Renaissance; Mr. Shanwen Gao, the Chief Economic of Essence Securities; Mr. Yuanjie Zhang, the Managing Partner of Wise Road Capital. For the moment, while the capital markets are soaring, the real economy struggling. At the meeting, what does this bull market, or even "mad bull", caused by excess liquidity, means for investment in the new economy? Is this an opportunity or a trap? A heated discussion took place.
Mr. Fan Bao regards that the epidemic is an "accelerator"-the epidemic will not change anything but accelerates the fact that have occurred, such as the Matthew effect in the capital market, the rise of the new economy, and the confrontation between China and the United States. In the new economy, the best asset allocation category is growth stocks. However, the current growth stock Matthew effect is obvious, and the head enterprise supply is limited, and the final share price can only "rise", so the valuation is "trap". In the case of severe Sino-US relations, it is not necessary to pursue high returns in the short to medium term, but risks must be controlled/reduced. The core of risk control is asset allocation. In an uncertain environment, it is difficult to make strategic planning in advance, so asset allocation can only be carried out through various scenarios to improve the ability to resist risks.
Mr. Shanwen Gao said that from a global market perspective, the recent performance of the capital market is good globally, which is in apparent contrast to the current situation of the real economy. But as expected, it can be understood and explained. The epidemic itself will not have a great impact on the market, and may even have a positive impact. The impact of emotions on economic activities, corporate value, and cash flow is destined to be short-term, so from the perspective of valuation, it will have a short-term impact on corporate value at almost at the PB level. The rise of the stock market has helped the economy: stimulate household consumption, broaden corporate financing channels, and increase the proportion of direct financing in the whole society. Truly valuable companies can traverse the bulls and bears and bring huge returns to investors.
Mr. Yuanjie Zhang believes that in the short term, regarding the ban on the sci-tech innovation board, it is a general trend for companies with high-techcontent to choose to go public. This structural general trend in the next ten decade or two should be fine. If you want to avoid the trap, from the perspective of asset allocation, you can refer to the logic of the secondary market investment index, such as: Sino-US comparison, benchmarking the United States, the largest difference is the greatest opportunity, and the growth will be the fastest after ten years. The key is to grasp the structural opportunities, which is not only the establishment of the company's framework, but also the establishment of market opportunities.
In this salon, in addition to the three keynote speakers, the guests present were Mr. Haitao Zhang, President of CITIC Capital; Mr. Bing Hu, President of Sino-Russian Investment Fund; Mrs. Margaret Ren, the Chairman of Bank of America Merrill Lynch China, and a total of more than one hundred executives from leading institutions in the investment community, executives of listed companies, leading entrepreneurs in the industry, and CEOs of unicorn companies, gathered together for in-depth exchanges, collisions of views, and enjoyment of ideas feast.
Source: Oceanpine Capital
