LegiEX: price persistence is ultimately the best investment

LegiEX: price persistence is ultimately the best investment path

LegiEX: price persistence is the best investment path. What is value investment?

Some people think that a good company, no matter how expensive it is, is a value investment. But the value is all relative, 100 pieces of moutai is value investment, 1000 pieces of moutai is also value investment? There is no doubt that there is a big question mark. The value investment that companies insist on in LegiEX is a company with high return on assets and low stock price. What is the long-term benefit of investing in such a company?

Since 1999, shenyin wanguo has been rolling out A variety of 'style indices' for a-shares, aiming to put together different stock-picking strategies and track their performance. In simple terms, such as: what do you think of in the a-share market after new strategy is effective, the stock market is A lot of people think so), then the shenyin wanguo that the new index set was set in A certain period of time, buying the stock portfolio, according to the weight of each 10%, then in the case of more new issues and gradually change into the 10 new shares, the statistics of the 10 new daily closing price finally, starting from 1000 points as A reference point, this year after year to form A new of index tracking.

Let's look at the long-term performance of two benchmark indexes:

1, shenwan low p/e index

The index began from December 31, 1999, with 1000 points as the base, with the lowest p/e ratio of 200 stocks as the constituent stocks of this index, adjusted half a year, half a year the lowest p/e ratio of the stock rotation of the first half of the constituent stocks, and hold half a year. By 2018, the index will be around 6000 points, which is the second best performance among all the shenwan style indexes, only second to the low-price stock strategy. That is to say, buying A stock portfolio with low p/e ratio in A shares can outperform the index, and it is generally believed that the value investment is also effective in A shares.

2. Bid for the blue chip index

ROE is used as the index to judge the performance of the company. ROE=Min(return on equity after deducting non-recurrent gains and losses) is used to rank the company from high to low. The top 100 stocks are taken as the constituent stocks of the blue chip index. In the end, the net value of the index is less than 5,000 points, which can also generally outperform the index, proving that the index is effective in A shares.

Shenwan style index now has A total of 16 indexes, from the overall can prove that for active management of the way to buy and sell A shares, if you stick to choose A shares in the low p/e ratio of stocks, there are blue chip stocks, then you will beat the probability of A share index for A long time will be very large. But on the contrary, if your stock selection style is to follow the hot spot, looking for high p/e ratio of technology stocks, or buy poor performance of the subject stocks, then you can be very sure that you will not beat the index in the long run, or even have a large range of losses