Global investment in 2018: the trend's return
Anyone who does anything will get twice the result with half the effort by taking advantage of the trend, and going against the trend will only get twice the result with half the effort. The same is true for investment. Looking back at 2017, it was a year of abundance. The strong performance of the capital market brought huge returns to investors. What 2017 witnessed was the “return of the trend”. Trend changes in the growth structure, development focus, financial ecology, policy preferences and demand levels have all left a deep impression on the financial market. Looking forward to 2018, discovering trends and following the trend is still the key to investment success. Global economic recovery, shifts in diversification, new technological revolutions, consumption upgrades, globalization, and supply-side structural reforms will create harmony but difference The new era of the global economy has opened up a vigorous era of global investment.
2017, witness the return of the trend
First, the rise of emerging market stock indexes significantly leads developed countries, witnessing the trend force of diversified rising tides. From 2010 to 2016, the global economy experienced a round of diversification. The United States led the global economic recovery, and the economic growth scissors of the leading developed countries in emerging markets continued to shrink. With this, the US stock market led the global market; in 2017, the crisis passed In ten years, emerging markets, as the last leg of the crisis, have gradually completed the gradual release of risks, and have re-constituted the core engine of global economic recovery. The long-term turning point of diversification from ebb to rising has been formed. Accompanied by this, global capital has renewed Emerging markets are favored, and the growth multiples of the emerging market stock indexes in 2017 are ahead of the developed markets.
Second, the performance of the technology stock index leads the world, witnessing the trend force of the new economic ecology. The development of science and technology has the characteristics of "accelerated evolution". In 2017, both basic sciences and applied sciences such as artificial intelligence, biomedicine, Internet finance, etc., showed a flourishing vigor. Advances in science and technology have not only quietly boosted total factor productivity, provided solid support for long-term economic development and long-term market prosperity, but also significantly changed the economic ecology, laying a foundation for the evolution of human behavior patterns and market operation patterns. In 2017, as the primary productive force, the value of the times of science and technology has also fully emerged in the financial market. The performance of technology stock indexes in major markets have significantly led other industries, and benchmark companies such as Alibaba, Tencent, and Apple have shown tremendous development momentum.
Third, Hong Kong stocks lead the world's major markets, witnessing the trend power of Chinese elements exceeding expectations. Hong Kong has always been a link between the Chinese economy and the global economy. As an open economy and an international financial center, the performance of the Hong Kong market is closely related to the globalization of the financial market and the globalization of the Chinese economy. In 2017, Hong Kong stocks achieved significant gains that surpassed major markets, precisely because of the value of their positioning in a trend that exceeded expectations. Contrary to the beginning of 2016, the RMB appreciated strongly at the beginning of 2017, breaking the depreciation demon, and thereby achieving currency stability throughout the year; and the short-term rebound of China's economy in 2017 generally exceeded expectations, showing the world's No. The growth resilience of the two largest economies and major consumer markets. The systemic stability of China's economy and finance, as well as the bottoming and rebound of globalization following the weakening of the US dollar, have formed a double synergy, which has brought unique strong momentum to the unique Hong Kong market.
Fourth, the theme of consumption upgrading is sought after by the world, witnessing the rising trend of the new middle class. In 2017, the birth of a series of epic quotations in the capital market, including the market performance of topical companies such as Moutai, Midea, and Wenwen, all demonstrated the deep influence of global demographic changes on the economy, society and financial markets. With the post-70s, 80s and post-90s gradually replacing the post-50s and 60s as the main force of the global middle class, people-oriented consumption upgrades are becoming a strong trend, and China has become this trend due to the most distinctive middle class replacement. The backbone of the trend.
Fifth, the global stock market outperformed the global bond market, witnessing the gradual end of the era of low interest rates. In 2017, the long-term turning point of global monetary policy was truly established. The Fed turned from a dove to an eagle, and the frequency of interest rate hikes exceeded market expectations at the beginning of the year, and officially launched a balance sheet reduction plan; the European Central Bank announced a reduction in the scale of QE, the UK raised interest rates for the first time, and the Bank of Japan suspended Further attempts at the limits of ultra-loose monetary policy, such as negative interest rates, have also led to an upward trend in China's money market interest rates. Although the global exit of the ultra-loose monetary policy is only about to begin, it has already had a profound impact on the performance of global assets. Equity assets performed significantly better than fixed-income assets, reflecting the market’s judgment on the upward trend of both inflation and interest rates.
Sixth, the global risk appetite has systematically increased, witnessing the trend of systematic decline in the panic threshold. In 2017, the macro chaotic era of black swans and gray rhinos did not cause panic in the financial market. The central level of the VIX index has systematically declined, and has been below 10% dozens of times. In the past three decades, similar situations have been extremely similar. Seldom appear. The existence of uncertainty and the rise of global risk appetite follow closely together. Behind this seemingly contradictory phenomenon is the systematic decline in the panic threshold of the global market. Only geo-events and market crises of a sufficient magnitude can have a sufficient impact on the optimistic and positive market atmosphere.
Seventh, Internet finance phenomenon-level events frequently occur, witnessing the trend force of the endogenous evolution of the financial ecology. In 2017, the popularity of Internet finance rose again. Bitcoin prices continued to break historical records amid the ups and downs of criticism and heated debates. The performance of some iconic Internet finance companies in the capital market fluctuated sharply, reflecting the coercion of regulatory policies and industry trends. Complex process. As a field full of vitality and wildness, Internet finance not only shows great development potential in the capital market, but also faces certain growth pressures. Risks and opportunities are echoed.
2018, find the direction of the trend
In 2017, the market performance witnessed the return of the trend, and this is not only a short-term phenomenon, but also a long-term reality. Therefore, taking advantage of the trend is still the essence of investment in 2018 and beyond, and the premise of taking advantage of the trend is to identify trends. We believe that in 2018, some existing long-term changes will continue to occur, and some unexisting long-term trends are also taking shape.
In 2018, the direction of the trend is: First, the global economy recovers and shifts. After ten years of crisis, the global economy has officially shifted from "slow crisis" to "fast growth." The recovery of the real economy has exceeded the historical average. The fading out of monetary stimulus will not weaken the momentum of strong recovery. Second, the era of low interest rates continues to drift away. The marginal tightening of global monetary policy will continue. The United States has actively tightened, Europe and Japan have passively tightened, China has made its own decisions, and the low interest rate environment has undergone systemic changes. Third, the world needs a supply-side reform. The supply-side structural reform is rich in connotation. For the major economies in the world, although the focus of reform is different, the overall progress is the general trend. Fourth, the upsurge of diversification will begin. The transition of diversification from low tide to high tide is a long-term process. In 2018, emerging markets are expected to contribute more than 70% of global economic growth. In the next few years, the pattern of emerging markets leading the global economy will be further strengthened. Fifth, consumption is upgraded to globalization. The change in the global population structure is the fundamental reason for the formation and solidification of the new economic trend. The rise of the new middle class and the rise of micro-levels will lead to consumption upgrades on a global scale, and China will continue to play a leading role in this core trend. Sixth, the new technological revolution is moving towards a singularity. The development of science and technology will not stagnate, but will only accelerate, and the help of the capital market will speed up the singularity of the new technological revolution towards a major explosion, and the comprehensive reshaping of human social life will continue to occur. Seventh, systematic adjustment is unpredictable but inevitable. Global economic risks are transforming into geopolitical risks. The continued regression of European currency integration in 2018 is almost inevitable. Populism, islandism, and neoconservatism will continue to threaten sustainable recovery. The risks have not disappeared, and the risks are still there. Savings, and the long-term operation of the VIX index at a very low level also means that a long-saving adjustment is difficult to avoid.
Homeopathy investment advice
In 2018, the trend's return is still considerable. We have seven suggestions on how global investment can follow the trend: First, shift from investing in currency illusions to investing in the real economy. The global economic recovery in 2018 will be more driven by the real economy, and the marginal tightening of monetary policy will test the true gold content of the recovery. Any region, industry and company that can withstand the test is worthy of long-term investment. Second, the long-term investment value of emerging markets still has comparative advantages. The upsurge of diversification will begin. Once the momentum of accelerated global capital inflows into emerging markets is formed, it will not be quickly reversed. While supporting the recovery of the global economy, emerging markets will also be full of investment opportunities. Third, the stable and open Chinese market is still very attractive. In the era of macro chaos, China’s economic stability is scarce, and as a leader in emerging markets, China’s economic performance beyond expectations will continue to enhance market confidence. The long-term stability of the RMB exchange rate has laid the foundation for the internationalization of the RMB and China’s financial opening up. , China’s capital market will continue to be relatively strong. Fourth, the new technological revolution embedded in the consumption upgrade has the most investment imagination. The actual changes in human life by technological progress are taking place, and visible, perceivable, and understandable technological applications will bring the most recognized investment value. Fifth, global supply-side structural reforms have brought distinctive policy dividends. The mixed reform in China, the tax reform in the United States, and the institutional reform in Europe will all create considerable investment opportunities in the process of breaking first and then establishing. Sixth, strengthen confidence in the long-term future of the new era. The new era is a great era that truly emerges from the shadow of crisis. Globalization will bottom out and rebound. The rise of major powers will condense regional momentum. The global economy will enter a period of rapid development of "dual-core stability". The long-term trend of the capital market is worth cautiously optimistic. Seventh, wait for the best time to exert force after short-term adjustments. In the long-term upward process, short-term volatility is inevitable, especially the overestimation of the market, and a systematic adjustment is urgently needed. After the adjustment, the best time window for comprehensively increasing investment will be ushered in.