China’s retail stock traders ride US$1 trillion bull run, eye liquidity for more gains
Some individual investors see the rally carrying on, based on Beijing’s promise to put a floor under stocks and potential foreign inflows
Jacky Jia, a 47-year-old software engineer in Shanghai, said he reaped a return of more than 30 per cent from the stock market this year and expected a further 20 per cent through early next year. He based the argument on a pledge made by the government this year to put a floor under stocks in a shaky economy.
“The stock market is doing pretty well and it will go up further,” he said. “The economy is not in good shape. So that’s why the stock market needs to rise to create the wealth effect, which will spur consumption.”
Jia’s equity exposure is concentrated in new-consumer, consumer-electronics, software and hardware companies – the so-called high-beta stocks that tend to rise more when the broader market stabilises or stages a comeback.