Why has the A-share market been unable to stabilize at 4000 points for so many years?

Professor Liu Jipeng's statement is the best answer I've ever heard: rich shareholders, strong quantification, and poor retail investors!

First, the shareholding ratio of major shareholders in A-share listed companies has increased, and the cost is extremely low, only a few dimes, so going public means dozens or even hundreds of times, quickly thinking about cashing out.

In the last two months, we have been in a tug-of-war at 4000 points, with constant fluctuations under such difficult circumstances, and there have been daily announcements of share reductions. So when we think about breaking through the bull market and entering a slow bull, what are they thinking about? Overnight wealth! In these 8 years, major shareholders have reduced their holdings, draining 3.2 trillion from A-shares, more than the scale of IPO fundraising. Do you think under such circumstances, can it rise above 4000 points?

Second, strong quantification.

The speed of quantitative trading is hundreds of times faster than that of retail investors. More frightening is that they use AI crawlers to capture various hot news 24 hours a day. Utilizing short-term sentiment, they quickly cash out, and they have even moved their machines right next to the server room, right next to the exchange. Recently, wasn't there news that they had moved their machines away? Even more terrifying is that their trading costs are lower than those of retail investors, with some even lower than 10.8. Shouldn't the trading costs of quantification be higher than ours, facing more restrictions?

So under this network of quantification, retail investors have become fish in a fish pond.

Many people say that retail investors in the A-share market are shortsighted, and so are speculative funds; they are all trading short-term, trading on emotions, without a broader perspective.

May I ask, if the company's owners and founders do not have confidence in the company, feel that the stock price is too high, and want to cash out, then where does the retail investor get their broader perspective? Why should investors believe that this company will get better and better in the future?

When a market is dominated by quantification and quick arbitrage, what kind of technical ability and information capture capability must ordinary investors possess to discover good companies earlier than quantification? And why hasn't the A-share market been able to stabilize at 4000 points for so many years?

Ultimately, it comes down to one sentence: restrict major shareholders, restrict quantification, and retail investors can thrive, and the A-share market can improve. #A股 #大A