Why Do Many Investors Lose Money in a Bull Market? He Qiang: Sector Rotation Like a "Windmill," Institutions Make Quick Money While Retail Investors Become "Sheep to Be Sheared"

Special Topic: Strengthening the Defense Line for the Rights and Interests of Small and Medium Investors — Sina Finance 3.15 Investor Protection Forum

On March 13, the Sina Finance 3.15 Investor Protection Forum was held, with Professor He Qiang, Dean of the School of Finance at Central University of Finance and Economics and Honorary Director of the Securities and Futures Research Institute, delivering a keynote speech.

Discussing the current difficulty in market operations, He Qiang pointed out a phenomenon: despite the overall upward trend in the market last year, many small and medium investors still suffered losses. “Buy today, get trapped tomorrow,” has become a true reflection of many retail investors.

He described the current market sector rotation as a “big windmill” — sector rotation is extremely fast, changing almost daily. The sectors that rise today may fall tomorrow. He believes this “big windmill” style rotation is not caused by retail investors but is driven behind the scenes by institutions.

He pointed out that institutions use sector rotation to engage in ultra-short-term trading, sometimes earning only 1% or 2% profit before exiting. They are not earning from the dividends of listed companies but from the money of retail investors. This frequent short-term speculation contradicts the current regulatory emphasis on “slow bull” and “long bull” markets and is severely damaging the rights and interests of small and medium retail investors every day.

He called on regulatory authorities to pay sufficient attention to this behavior and include it in their oversight. “Regulation must be strengthened,” not only against obvious market manipulation but also against these covert, ongoing trading patterns that harm retail investors’ interests.

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Editor: Hao Xinyu