In the turbulent and unpredictable stock market, we often use faith and expectations as our compass, attempting to navigate through the fog and reach the shores of wealth. However, when our voyage deviates from the guidance of the compass, it’s easy to lose direction, even to run aground. This essay is about one such journey, beginning with an unwavering obsession with Xiaomi, which rose and fell repeatedly amidst the waves of capital.

The Clash of Faith and Reality: Xiaomi’s Gains and Losses

In June, I bought into Xiaomi with unwavering faith in Lei Jun and a hopeful vision for the company’s electric vehicles. At the time, faith was a powerful force, temporarily blinding me to Lei Jun’s shrewdness as a capitalist and overlooking the risks posed by the High-Level Flash Lightning Distribution Platform. Fortunately, several wave trading operations ended with modest profits, giving me a sweet taste of entering the Hong Kong stock market for the first time.

However, this self-confidence soon followed. After making a small profit on Jiu Fang stocks, I became somewhat dazed, relying solely on the flow of net buying funds from the Hong Kong Connect indicator instead of rational analysis.

Meituan’s “Waterloo” and Blind Re-positioning

Guided by the flow of funds, I turned my attention to Meituan. However, this time, I didn’t delve into the company’s financial data, its historical trends, or even realize the raging food delivery war that was unfolding. When the stock price began to fall, I failed to cut my losses in time and instead blindly added to my position.

Shares trading at HK$20,000-30,000, limitations on capital prevented me from managing my positions freely, which undoubtedly exacerbated my losses in Meituan. This lesson deeply made me realize that in the Hong Kong stock market, blind re-positioning is like trying to fill a constantly leaking bathtub with more water – it only accelerates the loss.

“Stupid People Are Lucky” - An Unexpected Gain

While I was worrying about Meituan’s losses, an unexpected turn of events occurred – I bought Alibaba. Although I didn’t hold onto it, I quickly sold it and used the profit to offset some of Meituan’s losses. This might be what’s meant by “stupid people are lucky,” allowing me to temporarily escape Meituan’s predicament.

Finance: More Important Fundamentals Than Investing

This experience also made me re-examine my financial management approach, aside from the ups and downs of the stock market. At the time, I invested a sum intended for short-term emergency funds into Chinese bonds. This money was meant to be used for payment within two months, but the short-term holding yield on the bonds wasn’t high, and it also posed liquidity issues. If I had instead chosen to deposit this money into a money fund, I could have earned more stable returns and readily redeemed it, better meeting my funding needs.