Hu Li Yang’s theory:
1) If an index’s price drops by 50% from its peak, it has entered an “fair value” price point
2) If an index’s price drops to around 25% from its peak, it has entered a “extremely undervalue” price point
3) When recovering from the bottom, the index will always face selling pressure at 2x the bottom price
4) During a bear market rebound, you can forget about fundamentals and enjoy the collective rising stock prices.
5) Many more theories listed on his book (30 theories/techniques)!
*click on the image to buy a copy of his book to learn more about his investing tactics
Examples of his theories
S&P500 peaked at 1,550 in September 2007, fell to 735 on Feb 2009 before it experience a rebound
Straits Times Index peaked at 3,800 on October 2007, fell to 1700 on March 2009 before it rebound
Shanghai Composite rebounded …