Hang Seng probably bottom out soon after correction

I believe that the Hong Kong stock market has reached the bottom and there is no need to panic and sell stocks. Instead, investors can focus on their favorite stocks at this stage. As I think there will be strong support for the Hong Kong stock market when it reaches 20,000 points. Currently, the Hang Seng Index (HSI) is on the verge of reaching this level. What is my strategy?

I currently hold stocks, mainly those I bought last year. However, I sold two-thirds of my remaining stocks earlier. Therefore, I have a lot of cash to absorb my favorite stocks. My remaining stocks are mainly Tencent and HKEX. My strategy is to continue to hold them and not to increase my position. I will use a small amount of buying put options as a hedge. Because I have already sold two-thirds of my holdings in these two stocks, my current position is comfortable. I believe that holding stocks is most important for one's peace of mind and comfort, which will increase my confidence in investing and make it easier to achieve my goals.

During this period, I will focus on stocks that have the potential to rise significantly but did not follow the market when the Hong Kong stock market rose sharply in the past, such as domestic infrastructure stocks. I have previously mentioned in my articles that post-pandemic construction in China will drive a large amount of infrastructure to boost the economy. Therefore, domestic infrastructure stocks such as China Railway Construction Corporation Limited (1186.HK), China Railway Group Limited (0390.HK), and China Communications Construction Company Limited (1800.HK) will be my focus.

My goal for the first half of this year remains unchanged, which is for the HSI to reach 25,000 points. As long as I believe that this goal can be achieved, any obstacles will become the driving force. Even if the HSI falls below 20,000 points, there is no need to panic. If this happens, what will be my strategy? First, we need to determine where the next support level will be, such as near 18,500 to 19,000 points. Then we need to wait for two to three days to see if there is support at that level. If there is support, we can buy some of our favorite stocks at that level. Otherwise, we need to observe and find the next support level. However, I believe that the Hong Kong stock market is still bullish this year, and I believe that there is a high chance of reaching 25,000 points.

Therefore, I personally believe that there is a very high value betting rate near 18,500 to 19,500 points. However, it is unlikely to be seen as the stock value in Hong Kong has no reason to be only 1 times PB. Taking into account the three factors of domestic economic recovery, overseas liquidity easing, and Hong Kong stock market valuation still at a low level, I believe that the Hong Kong stock market will perform well in the future.

$HSI(HSI)$ 

$Hang Seng Index - main 2302(HSImain)$ 

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