In 2006, a bank in Zhengzhou put out an advertisement on its front door, hoping more people could open investment accounts in the bank. [Photo: 21cn.com] Frankly speaking, for the majority of the Chinese people, making a fortune is like "surfing the bull market" in 2006 and as excited as "taking a roller coaster" in 2007. Now, as the Olympic year of 2008 is coming, what will it be like in the new era?
Some people predicted that the bullish stock market had entered the second phase and will soon slip into the "injury time". Some people said that the slightly lowering housing prices is not a "fake dive", following which a number of real estate agents will have to close their doors this February. Others say that the shadow triggered by the "sub-prime mess" in the United States would also affect the Chinese economy.
Want to make a big money in the new year? The most important thing is to avoid the possible risks.
Stock market: will it be bullish as well?
At the beginning of a new year, the media and press are working on writing annual reviews for the past year. "Asia Weekly" crowned the over 100 million Chinese stock investors as their "people of the year". The reason was that the number of investors grew from the original 78 million to 130 million in the year of 2007, during which we witnessed a record-breaking bull market.
The family of grandpa Wu in Beijing is a typical example of the mass investors. All the family members in the family were investing in the stock market, from the 80-something elderly to the younger generation born in the 1980s. What's more, without any insiders' guide, their average return ratio reached 70 percent, with the highest being 200 percent. By now, they have put over 90 percent of their capital into the market and after one-year's ups and downs, they have grown into rational investors.
We'll never put it (money) in the bank
Since purchased fund for the first time, grandpa Wu changed from "never go into the stock market" to "never keep money in the bank".
"As early as in 2006, when the market index broke through 2,200, I advised my dad to buy some stocks as investments, but he didn't listen to me. I can understand him, as an old man who knew nothing about the capital market, he was afraid of the possibly risk," said Wu Yong, the youngest son of the family.
After about half a month, encouraged by Wu Yong, grandpa Wu finally decided to have a "try" of the stock market. He took 10,000 yuan out of his bank account and invested in a fund. He found that the return rate of the fund was much higher than from fixed deposits and he then decided to go a bit further. By August, 2007, grandpa Wu owned three funds with total profitability reaching 110 percent.
"Now, he doesn't want to put any money in the bank," Wu Yong said with a smile.
"Only leave 10 percent of the income in cases of emergency." That's the investment guideline of the Wu family. It also reflects Chinese investors' strong expectation of a bull market, which arouse the awakening of more individual investors and lightened their passion to invest in the stock market. It also explained why as many as 13,795 investors opened accounts in Shanghai or Shenzhen markets by Dec. 20, 2007.
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