Sell Hong Kong stocks

On July 27, 2021, I made the biggest move of the year and cleared Tencent, Haidilao, and JD Logistics. Let me explain the logic one by one:

First, let's talk about the most prominent one $TENCENT (00700.HK)$ . Previously, to me, Tencent was the kind of stock that never needed to be sold, just like...

However, with the implementation of the double reduction policy, I have gained a new understanding of the size of the national policy and the resolute attitude. In addition, from the recent release of information by the Cyberspace Administration and other ministries, although not named directly, Tencent and Meituan are obviously wanted number one and number two.

Among the richest people in the United States, more than half are engaged in internet-related businesses. However, the current policy in mainland China is the opposite, where the internet cannot strengthen the country, only "hard technology" can. But what exactly is hard technology? Does the big data, cloud computing service, and mobile payments of internet companies count as hard technology? It seems that it's not considered as such in the eyes of the boss.

Yesterday, it was rumored that the leaders of the China Securities Regulatory Commission held a meeting with all investment banks. The general idea is that the policies regarding the education and training industry are targeted and will not have a significant impact on other industries. As a result, the previously hardest-hit sectors in the A-share and Hong Kong stock markets, such as technology, pharmaceuticals, and food & beverage, experienced some recovery. But in my opinion, even if the news of the meeting is true, it still feels like a sense of "don't leave, fellow villagers." The feeling of the sword of Damocles hanging over our heads is not good, and you never know when another policy will come out, whether it will be a stick or honey, or directly damage and crush you.

I cleared my position on Tencent due to the great uncertainty of future policies. I'm scared, it's as simple as that. Tencent's cost is over 380, with some profit.

2. Haidilao. $HAIDILAO (06862.HK)$The final reason why I decided to cut my losses is because on July 27th and 28th, I was on a business trip to Nantong. I didn't have lunch until 2 PM in the city, and happened to see Haidilao. I asked my friend from Nantong about their opinion on Haidilao. My friend frankly said, "Who still eats at Haidilao nowadays..."

To be honest, I made a psychological mistake in judging Haidilao, as mentioned by Charlie Munger. It is that people usually cannot have a completely objective view of what they possess. As an example, after people buy a car, they tend to praise it when talking to others, even if the car does have some minor issues. They will often avoid discussing these issues and may even belittle cars from competing brands.

Another reason I cleared my position on Haidilao is the recurring COVID-19 pandemic. Nantong, where I went, is very close to Nanjing. The Delta variant has already spread in Nanjing, and isolated cases have also appeared in other regions. The mutated virus has surpassed the control of the existing vaccines. This once-in-a-century pandemic may last much longer than people's imagination. Let me show you the latest chart of new and confirmed cases.

Haidilao really made me suffer losses, losing Hong Kong dollars. My biggest lesson last year was to learn to short, and this year it was to buy Haidilao at a low price. But the money lost is worth it.

3. JD Logistics. $JD LOGISTICS (02618.HK)$ The logistics industry is really chaotic. In some industries, everyone can consciously maintain a certain profit margin and avoid malicious price wars, resulting in a win-win situation. But in some industries, such as the logistics industry, internal competition is particularly severe. Because of the disruption caused by Flash Rabbit Express, the entire industry is not making money. For example, in the mobile phone industry, except for Apple, Samsung, and Huawei, which still have a certain profit margin, other mobile phone brands even struggle to survive. $XIAOMI-W (01810.HK)$The catering industry mentioned above and the logistics industry here are both tough industries. Everyone doesn't have much competitive advantage, and even if they do, they have to work very hard to maintain it. Any slight mistake or relaxation will be taken advantage of by competitors. Charlie Munger once mentioned this phenomenon, saying that he himself couldn't figure out the reason behind it, so it's best to stay away.

The loss ratio of JD Logistics is the largest, -40%+, luckily I participated in the new share issuance and bought some in the gray market, losing only 12,000 to 20,000 Hong Kong dollars.

Oh, my performance in holding positions hasn't been good this year because my basic belief is to hold for the long term. Among my holdings in US stocks, only Apple and AMD have increased by less than 10% since the beginning of this year; PDD

股票 translation is missing. $Apple (AAPL.US)$股票 translation is missing. $Advanced Micro Devices (AMD.US)$股票 translation is missing. $PDD Holdings (PDD.US)$And BILI $Bilibili (BILI.US)$Because of concerns over the policy uncertainty of Chinese concept stocks, I had previously cleared all my positions, and the clearing price should have been reduced since the beginning of the year. Nio Inc $NIO Inc (NIO.US)$And TESLA $Tesla (TSLA.US)$From the beginning of the year until now is still negative. Plus the Hong Kong stocks... it's really frustrating.