The performance of U.S. stocks over the past month has forced the vast majority of investors to lament “live for a long time”, four times in 10 days, three consecutive trading days average volatility of more than 9%, the 2008 financial crisis after the biggest weekly decline, the biggest weekly gain in nearly 90 years …

U.S. stocks, the bellwether of global capital markets, seem to have been wrapped up overnight in the mold of emerging market stocks…

“I’m greedy when others are afraid, I’m afraid when others are greedy” – a long-known quote from Buffett, the god. After u.S. stocks fell into a bear market at the fastest time in history and rebounded last week, are there more people in the market who are afraid or greedy?

“It’s a once-in-a-lifetime buying opportunity!” john Rogers, chairman of Ariel Investments, said in an interview with US media on Friday. “

And experienced the last financial crisis, the senior stockholder, Chinese-American Mr. Sun told the first financial reporter, the 27th has been added to the short order, the target of shorting is mainly offline entertainment companies and very affected by the global supply chain changes of auto manufacturers. In his view, the rebound in the bear market is only a temporary short-fill, and will not last long, he thinks the bottom may not appear until the middle of the year.

The road to a rebound is likely to be long.

In general, the bulls and bears in the U.S. stock market depend mainly on market confidence and expectations for future economic trends. The “shock” of global economic activity triggered by the outbreak of the new corona virus, coupled with the impact of the collapse in oil prices, has dusted the outlook for the economy.

Goldman Sachs predicts the U.S. economy could contract as much as 24 percent in the second quarter. Analysts at the agency said such a contraction would be the largest quarterly decline in domestic survival since records because of the record.

The Brookings Institution, a US think-tank, argues that while the US economy will undoubtedly decline in the short to medium term, it is not yet possible to determine how long-term the impact of the outbreak will be on the economy.

“Take history as a mirror, you can know Xingxing”, let’s first look back at the historical recession, the performance of U.S. stocks.

In the 12 recessions of 1937-09, for example, the index fell by an average of 31.5 per cent, with the biggest fall of 57 per cent during the last financial crisis; U.S. stocks have been quiet for nearly three years.

If you look at the closing price, from 3,386 on February 19th to 2,237 on March 23rd, the biggest decline in the S. and P. 500 is nearly 34 per cent, above the historical average. But after a month of frenzied selling, the market has seen less selling, and many bulls are jumping on the bandwagon to get ready to enter.

Howard Marks, founder and co-chairman of Oak Tree Capital, said on March 17th that the sell-off had completed about 60 per cent, and a week later he repeated in his latest investment memorandum that no one knew when the market would bottom out, but given the current price drop and the strength of the sell-off. It may not be the best time to enter now, but it’s a good time.

27, the S.P. 500 closed at 2,541, rebounding 13.5 percent from its lowest point, seemingly rekindling expectations of a return to the bull market.

However, even though 2237 points may be the lowest point in the current bear market, but considering the last bear market (1968-70, down 36%), it took 543 days to return to the bull market’s highs, and the current bear market just lasted more than 40 days, now looking forward to a return to the bull market, it is a bit of a rush.

The worst of it may be over.

It is the so-called “bull market does not say the top, the bear market does not say the bottom”, although no one is 100% sure whether the bottom point of this bear market in the United States has appeared, but from the Chicago Options Exchange (CBOE) volatility index (commonly known as the panic index) trend, the most panic moment of this period may be over.

The panic index closed at a multi-decade high of 82.69 on March 16, surpassing the previous peak in the financial crisis, and on the same day the S. and P. 500 fell to 2,386. It is worth noting that since then there has been a very rare divergence in the panic index and the S. . . 500 index, and the S.P. 500 continues to dip, but instead of surging again, the panic index has fallen in tandem.

When the S. and P. 500 fell to its lowest level on the 23rd, the panic index closed at 61.59. With the panic index representing expectations of the expected volatility of the benchmark index over the next 30 days, this may mean that the market’s panic has crossed the peak and is gradually returning to normalization.

“Even in 2008, volatility indices can only hold six trading days above 70 (five of us so far this year are above 70), ” says Pravit Chintawongvanich, equity derivatives strategist at Wells Fargo. Whether the stock market continues to fall or rebound, there is room for further normalization of the volatility curve. “

Michael Purves, ceo of Tarabeken Capital Consulting, cautions that falling volatility does not mean that the market is bottoming out, but merely shows that sentiment has gradually calmed down thanks to economic stimulus measures and improved liquidity.

Not only the volatility index, other market data also show that last week a large number of bulls have entered the bottom.

Notably, the Put Options ratio of CBOE to Call Options was high on March 12. The ratio of put-option positions to call options rose to 1.28, the highest level in years, but just one day later it returned to 1.0 levels, falling to 0.7 as of the 27th, back to the more common range of volatility of 0.5 to 0.8.

CNN’s Fear-Greed Index has also risen below 10 for several days two weeks, rising back above 20, although still in the extreme fear range (0-25), but the situation has eased.

It’s 1987? Or 2008?

While historical experience can be used, it cannot be fully copied – after all, no bear market in U.S. stock history has been directly caused by the outbreak, nor has the Fed ever seen such a “ground-breaking” rescue.

So talking about a 2020 bear market is more like 1937, 1987 or 2008 doesn’t make much sense, and perhaps only in the 2020 bear market will there be when U.S. small and medium-sized business owners worry that their capital chains are on the verge of breaking and going bankrupt, but so many institutions are talking about the magic scene of the bottom of the market.

Looking ahead to the future, the biggest uncertainty is the outbreak. The outbreak will eventually pass, the economy will certainly have a day of recovery, but no one can be sure when the global inflection point will occur, so at this time whether to copy the bottom, or continue to wait and see, everyone’s views are different.

Mr. Shi, a Chinese-American holding a large number of technology stocks, told First Financial that since The U.S. stock fell in February, his book has lost more than $10 million, which inevitably affected his mood. However, he has no plans to sell at the moment because he believes that for up to a year or two, “it will definitely go up again”.

There is a 90-year-old young Mr. Liu told the first financial reporter, in early March has been copying the bottom of a well-known Chinese stock, but did not expect the market continued to fall, fortunately last week’s rebound helped him to make up a lot of losses. He thinks he has managed to get to the bottom this time, hoping that the market will rebound further, and that only when the share price returns to the former high will he consider profiting.

Perhaps, as Max puts it in his latest memo, “bottom” is the day before the recovery begins, so it’s impossible for us to know when to bottom – never, “We categorically reject the idea of ‘waiting for the bottom’, and our goal is to buy when we can get value stocks at a low price.” “