Today is the weekend, let’s talk about a lighter topic to let everyone relax.
In the minds of most people, retail investors always seem to be "leeks".
They talk about technical analysis but shut up about macroeconomics. They operate as fiercely as a tiger. Looking back, the vast majority of retail investors cannot escape the fate of being "cut off".
However, a few days ago, the US Securities Regulatory Commission sentenced a group of retail investors from Shandong, China. They have made trouble in US stocks in the past 6 years, manipulating the stocks of 3,000 US listed companies and cutting off 35 million US investors. U.S. dollars, equivalent to RMB 240 million, is more valuable than Wall Street and Wall Street.
Today we will use this incident to uncover the mystery of the capital market and talk about what these dozen retail investors from China are capable of. They can still dominate the capitalist base camp and make a living in the United States by cutting leeks. Buy a house, buy a car, and get to the top of your life?
In fact, the whole thing is not complicated. This pair of two brothers from Shandong, named Wang Jiali and Wang Xiaosong, learned some things about market trading during the years when the "local gangs" of China's A shares were fighting fiercely. Technology.
But the little three-legged cat skills they learned were far from enough in A-shares, so they changed their thinking:
Domestic sales and exports, traveling across the ocean, and going to the US stock market to cut "foreign leeks".
Since September 2013, the two brothers gathered more than 20 fellow villagers, forged information, opened more than 100 accounts in multiple securities companies in the United States, and started "show operations."
Their operation is very rough, it is simple Spoofing, also called spoofing transactions .
What is "spoofing"? This is what is often referred to in China as “frequent order cancellations”.
The first step is to divide the account in your hand into two groups, one group is the "cover" and the other group is the "hook".
The second step is to look for "thin stocks" in the market, which are unpopular stocks with low trading volume and not many people paying attention.
The third step is that the group of accounts used as a "cover" places a large number of sell orders on the market at a price higher than the current transaction price, making retail investors think that the stock has a poor future and follow up with the selling, creating a "herd" effect".
In the fourth step, the trader will cancel the sell order, send a "hook" account to enter the market, buy the bottom at a lower price, place a large number of buy orders, and use the psychology of retail investors to chase the rise and kill the fall to sell.
The purpose of such an operation is to take advantage of the eagerness of retail investors in the market to make quick money, buy low, sell high, and create an information gap.
The price of each transaction will not vary greatly. Just because you have a large number of accounts, a high frequency of transactions, and a long time span, there will always be gamblers who do not believe in evil and take the bait.
Of course, Shandong retail investors have worked hard for 6 years and only got 30 million US dollars, which can only be regarded as a "small fight."
Compared with the following person, he is the master of cutting leeks. Who is it?
That’s Musk.
He is a genius entrepreneur, but when it comes to cutting leeks, Musk can go to Mars.
He cut his own Tesla fans will not talk about it. Last year, Musk announced that Tesla would accept Bitcoin payment, and the price of Bitcoin rose sharply.
Not long afterward, Musk turned his back and stopped accepting Bitcoin payments. The price of Bitcoin fell by 15%.
What’s even more outrageous is that he also publicly called “ Dogecoin ” an “air currency” platform that was originally born to mock the digital currency .
Within half a year after Musk gave Dogecoin a platform, this completely false “air coin” actually increased more than ten times.
Just when everyone thought that Musk really believed in the blockchain, Musk publicly admitted on a TV show that Dogecoin was a scam. After cutting the leeks, he slapped him in the face and said, yes, you are all Sabi.
This reminds me of Luo Yonghao’s famous saying at the mobile phone conference, Hammer mobile phone is made for stupid people.
The effect of the program was too strong. After the leeks were cut, they were also mentally beaten through the screen.
Many people will definitely be confused?
Why is the fraud method of Shandong retail investors so vulgar, and some people still fall for it? Why can’t thousands of “leeks” see that Musk is using his influence to manipulate the market?
The reason is actually very simple.
First, people always think that they can earn money beyond their knowledge and abilities. When it comes to making money, they only see the results and don’t care about the process.
Today’s society is full of eagerness for wealth. When I see examples of successful people and popular tracks, I think that I can also be successful, but others are more lucky than me and were born a few years earlier.
This is just thinking about the wolf eating meat and not seeing the wolf being beaten.
In this impetuous environment, many people are obsessed with investing, starting a business, making quick money, and preferably getting rich overnight.
spoofing transactions take advantage of this mentality, artificially creating information gaps for arbitrage. Don’t you want to make quick money? I will create the illusion of prosperity to lure you in.
Sometimes, everyone knows clearly that there is a problem, but still insists on entering the market, thinking that he has the ability and ability to escape unscathed, and he must be the lucky one.
But the reality is that most people rashly step into fields they are unfamiliar with without sufficient ability. When they see someone making money, it doesn’t matter who they are, why can’t I make money?
was finally lost in greed. Only when Huang Liang woke up from his dream did he repent.
Not to mention ordinary people, in my past experience of dealing with entrepreneurs, I have seen too many examples.
There are entrepreneurs who made a fortune in the second-hand metal business, but they thought the money came too slowly, and ended up falling under the high leverage of the futures market; there are entrepreneurs who are very stable in their own business, and when they see the real estate business is booming, they also want to develop real estate. , and finally the capital chain broke.
How can money be so easy to make?
If anyone can make money easily, then why study business? Why do we, education and training institutions, need ?
So, whenever you want to be greedy, you should remember one sentence.
"Those who are really doing business will only earn limited profits that you deserve. Huge profits will not last long."
is like Buffett said at the shareholder meeting this year that the best investment is to invest in yourself.
Before investing in and apple , the old man spent 4 years studying Apple's model and industry chain. He knew Apple better than Apple itself, so he dared to make a large-scale investment.
For us entrepreneurs and investors, we should always pay attention to what kind of abilities we have and what value we can create? How can I make money and keep it?
It is important to see opportunities, but it is more important whether this opportunity belongs to you.
People pay for cognition throughout their lives. Ability and wealth are constant. Never cross the boundaries of your abilities and enter an unfamiliar field.
Second, many people actually do not have the ability and habit to think independently, and are more willing to believe in the opinions of KOL opinion leaders.
Just like Musk, he is indeed a successful entrepreneur. Many people admire him and believe in him.
But the question is, is Musk a good investor? Is he professional?
Obviously not, but many people just think that Musk is an idol and an opinion leader. What he says is definitely right. You can make a lot of money by following him.
This is like the mindless star chasing in the current fan circle. Whatever the idol says is whatever it is. I unconditionally believe the answers that others tell us.
Even if he is obviously not professional in this field, even if what he says cannot stand verification at all, we are not willing to use our brains to think.
In many cases, the underlying logic of investment and entrepreneurship is common, but the abilities that need to be paid attention to at each stage are different, and the choices made are different.
If we regard an enterprise as a living body, growth is the interaction between the enterprise and the environment, and it is a continuous choice. Every choice is a reflection of adapting to changes and an evolution of survival of the fittest.
Correct thinking is to avoid stuffing practice into old models, but also not to give up theoretical progress and research, look at problems with a changing perspective, and use theory to guide practice.
refine their own opinions from complex information, match their own abilities, and find the direction that suits them, instead of being led by others.
Only by realizing this can we find our own long-termism and pursue real value in managing our own lives and careers.
Finally, I end today’s Shan Renxing with a line from the classic movie “Wall Street”:
Good things sometimes take time.
Good things cannot come in a hurry.
—
Responsible editor | Luo Yingfan
