Foreign investors have "strange" moves, stock experts reveal the secret to catching the bottom of stocks

(NLDO) – VN-Index has recovered strongly, ending the losing streak, many investors are choosing the strategy of buying stocks at the bottom…

Last week, VN-Index closed up 9.53 points, reaching 1,228.1 points, ending a series of consecutive days of decline, bringing hope to investors.

In the last 3 trading sessions of the week, some investors bought stocks at the bottom with the expectation of strong buying demand when VN-Index returned to the strong support zone around 1,200 points. Although foreign investors still net sold more than 5,100 billion VND on HOSE at the end of the week, there were positive signs when they "turned around" and net bought nearly 30 billion VND for the first time in many sessions.

According to experts, the trading ratio of foreign investors in the Vietnamese stock market is only about 8%-9%, but when they continuously sell net, it will create negative sentiment for domestic investors. If the VN-Index wants to bottom out, foreign investors must stop selling net and buy again - reflecting the smart money flow that has activated...

Stock market recovers in weekend sessions, bringing hope to investors

Regarding the experience of catching the bottom of stocks, Mr. Nguyen Viet Duc, Director of Digital Business, VPBankS Securities Company, said that catching the bottom during the session often does not yield good prices, because even when stocks increase sharply, the ATC session often slows down a bit. Investors should restrain their desire for stocks during the session and wait until the ATC session to disburse. When the market goes up, there are always adjustments, investors should leave some money to wait for the correction.

"There are some signs that the bottom is near. First, P/E (price to earnings of stocks) in any bad market, P/E will only return to 10 - 11 times. This happened in 2016, before entering the strong increase wave of 2016 - 2017; in 2020, before entering the COVID-19 wave and in 2022 when there is a story about bonds. The second method is based on P/B (price to book value) valuation, the market has some key support points at 1,155 points, if the market returns here, there will be a recovery wave" - ​​Mr. Viet Duc said.

The final method is the fear index - that is, find how many stocks are trading below the strength index (RSI) 30. The number of stocks trading below the RSI 30 threshold to 20% - 25% is the high fear threshold of the market, there will be a recovery wave.

Regarding the secret to catching the bottom of stocks, Mr. Nguyen Viet Duc stated his opinion, catching the bottom using the shark method, dividing money into 4 parts. The first time catching the bottom, use 25% of the available money.

Next, disburse another 25% if the stock moves sideways or at the next support. If after 2 disbursements of 50% the loss is over 10%, you have to cut and start over.

The remaining amount is only disbursed on the other half of the bottom, that is, on the 3rd time, buying 25% if the stock makes a bottom and goes up (crosses the MA20 average line). The final disbursement is when the market increases again and the stock crosses the 3 important average lines MA20, 50 and 200.

This method is much safer than buying all the stocks at once, allowing for multiple disbursements. It is important that investors stay alert.

In the current context, Mr. Vo Kim Phung, Head of Analysis Department, BETA Securities Company, said that investors need to maintain a strict risk management strategy and avoid increasing the proportion of their portfolio in highly speculative stocks. Priority should be given to stocks in industries with good fundamentals, stable cash flow and long-term growth potential.

"It is also important to closely monitor foreign capital flows. If the net buying momentum at the end of the week is maintained, we can expect the market to continue its positive recovery momentum," said Mr. Phung.

Source: https://nld.com.vn/khoi-ngoai-co-dong-thai-la-chuyen-gia-chung-khoan-tiet-lo-bi-quyet-bat-day-co-phieu-196241124075903321.htm