The "Game" for Smart People: Understanding Investments, Capitalizing on Trends

Time:  2023.11.14    |    Source:  JJTZ

Introduction

With the gradual realization of the effects of policies combination, China's economic operation has continued to recover since August, but the recovery of China's economy will still be a process of undulating development and meandering progress. Although the current domestic demand is gradually recovering, the scale of investment also continues to expand, but whether for the country, enterprises or individuals, investment is still a decision that requires careful consideration in the current economic situation.

1. Investment Definition

Investment refers to the process of transferring funds by the state or enterprises as well as individuals for the specific purpose of promoting social development and realizing mutual benefits. From a financial point of view, compared to speculation, investment has a longer term and requires more careful analysis and research, and tends to be more for the purpose of obtaining some kind of sustained and stable cash flow income within a certain period of time in the future, which is the accumulation of future income.

2. Investment Classification

(1). Classification by Investment Methods

(2) Classification by Type of Invested Assets

(3) Classification by Investment Behavior

The above examples show that strategic investment is more important than financial investment in terms of strategic synergies, and is more concerned with the optimization and expansion of its own business and the integration of resources. Strategic investment generally has a large scale, long cycle, based on long-term goals, staged approach and other characteristics, is a significant impact on the overall investment. For example, government investment is generally a strategic investment. As a major government function, government investment is related to the overall economic and social development, which is not only an important means to implement macro-control and national development strategy, but also a powerful tool to guide and drive social capital to expand effective investment, playing a key role in stabilizing growth, promoting reforms, adjusting structure, benefiting people's livelihoods and preventing risks, as well as making up for the short boards of development, optimizing the supply structure, and enhancing the development momentum. It plays a key role in this regard. For enterprises, strategic investment needs to be policy-oriented, comprehensively consider the current situation of the enterprise, its own resources, the project situation and the industry environment and other factors to make strategic investment decisions.

3. Strategic Advice

Compared with financial investment, strategic investment is an investment for long-term development, and the expertise involved in decision-making will be more comprehensive and complex. The consulting team should conduct a number of strategic studies based on the investor’s needs.

The path to counseling can generally be roughly divided into three steps：Trends，timing and substance.