Is Da Zengzi wronged or not?

Since going to Taoyuan for a meeting, Big Hazelnut has been praised so highly that he truly believes he’s a market speculator. But this is also a kind of obsession. In the market, all obsessions are eventually educated by the market until they are painfully broken. So if the heart isn’t dead, the way won’t be born. Everyone who trades stocks, in the end, survives without worldly attachments. They believe in fate, going with the flow, not seeking or clinging.

So what level does Big Hazelnut belong to? Actually, he’s just an average gambler. Recently, I looked at several of his trades; I already dissected his last one. Good traders generally know their fate by the close after buying in the same day. They wait for the market to reveal itself. Traders like that are actually very low-level. Let’s look at Big Hazelnut’s monotonous Friday in Tongding Interconnection.

He clearly knows what he’s doing. He has already seen that the main trend is fiber optic concept stocks. But within fiber optic stocks, the leading stock, Changfei Fiber, has weakened. Zhongtian Technology, Hengtong Optoelectronics, and FiberHome Communications are starting to position themselves. These are recognized as the mainstream, certain stocks in the market. So what is he doing? He’s doing a third-tier catch-up rally on Tongding Interconnection. Short-term traders expect to buy on the same day and see a big rise, or directly bet on the limit-up. They aim for a premium on the second day, meaning they buy today and expect a significant premium immediately. If they buy at the limit-up, they bet on the premium on the next day when the stock opens up again.

So what is he doing by buying Tongding Interconnection? He’s doing a catch-up rally. After positioning, the classic method in leading stock strategies is to only buy the leader. Usually, in a very strong market, if the positioning goes smoothly, there will still be a premium on the second day. But Tongding Interconnection belongs to the third tier. Unfortunately, he forgot one thing: stocks like this are strongly correlated with U.S. tech stocks. U.S. tech stocks plummeted on Friday. The second-tier positioning usually has a good, small premium, but for Tongding Interconnection in the third tier, it’s even less.

Why did he buy Tongding Interconnection? Because it had a fierce rally in the morning, likely a quant-driven fake-out to push the price higher. This kind of fake rally, where the moving averages can’t keep up, is already a very basic tactic. Few are fooled by such manipulations anymore after countless daily and monthly harvests. The new retail investors are especially prone to get excited by this. If he watches the market, I guess he’s also influenced by this shock. But, perhaps because he’s slightly afraid of losses, he didn’t rush to buy back, and he couldn’t find a target. Seeing the fiber optic sector’s second tier, he didn’t dare chase, so he patiently waited to buy Tongding Interconnection at a lower price.

From a fundamental perspective, Tongding Interconnection has already sold all its equipment, and the fiber optic orders from the American company are purely market speculation at this point. The company hasn’t officially confirmed anything. So, conceptually and technically, it’s very problematic. He is fantasizing about a small premium with full position. That’s his entire mindset. What’s even more ridiculous is that he only sees today’s paper gains, never considering how much position size those gains are based on, or the risk and exposure he faces tomorrow. How much loss needs to be provisioned? This is a very basic mistake—like just joining the fun without any technical skill, a common gambler. We all gamble, but at least you should gamble with some skill. Your stock selection should have technique, your position control, or even going all-in, but you must consider exposure. At least, you should know if you’ve already made a mistake when buying in. I don’t even know why Yamada-san insists he’s better than Chen Xiaoqiun’s stock-picking methods and still rates himself highly. That’s completely unprofessional and irresponsible. It’s just going to ruin him.

Looking at his operation, besides being brave, what’s the difference between him and ordinary retail investors just jumping on the bandwagon? He’s also very opportunistic and cunning. Maybe after a big loss, he started a subtle mental shift—hoping small profits will gradually restore his confidence. But he forgot that small profits can reduce position size, yet he still needs to buy the strongest stocks. Not to chase small gains with large positions. He’s a completely unqualified gambler, or maybe he just doesn’t know how to block losses. Continuing like this, he’ll end up divorced, family broken, ruined. Poor wife and children. I don’t oppose everyone having dreams, but you need to assess your own level. Without skill, just be honest and work on construction sites. Everywhere there are tigers, elephants, and wolves. If you’re uneducated, unskilled, and have nothing, rushing in to grab money is basically asking for death.

He does have one thing—his previous chaotic, riotous era of smashing, looting, and fighting. People are bold, land is fertile, and he made a quick profit, thinking he’s enlightened. But the truth is, money earned by luck is lost by strength. Now he always feels targeted, like a paranoid delusional. It’s like a mental illness—after repeated injuries, he imagines everyone is out to get him. That’s shallow mental disorder. He’s also fantasizing that there’s resistance against him, but do you think the main players are paying attention to him? The market never wrongs; if you’re not making money, it’s because your rhythm is opposite to the market, and you’ve been slapped in the face. What you need to do is stop, adjust your rhythm slowly, follow the market, and then make money. That’s the basic quality of a gambler.

So I suggest these gamblers take a good look at the basic cultivation of a gambler. I don’t usually mess with stocks, but even I, as an outsider, can analyze these kinds of stocks. Do you think what I said makes sense? I wouldn’t dare participate. Those who know nothing and rush in recklessly, of course, get completely stripped by the market and end up losing everything.