Chapter 5: Full-Subscription Supporters

As the email containing the research reports was sent out, Zhang Yang’s QQ messenger began to ping incessantly. His roommate, Chen Chuan, even called him directly to ask for the details.

"Roommate, have you switched careers to become an analyst?" the other party asked, getting straight to the point.

"Life isn't easy, and I’m looking to make some money. Won't you support your good brother?" Zhang Yang replied with a half-joking tone. Although he had spent over a week rushing to finish these reports, he would have gladly given them to Chen Chuan for free if he had insisted, given they had been roommates for four years.

"Hmm..." Chen Chuan pondered for a moment before asking, "Where are you now?"

"In the finance room on the sixth floor of the library."

"I'll be there in a minute."

Shortly after, Chen Chuan arrived with Wang Liu and Xu Jiafeng. As soon as the four met, Wang Liu couldn't help but exclaim, "Roommate, you’ve been hiding your talents! Who knew you were working as an analyst!"

"No wonder you’ve been leaving early and coming back late lately. I thought you were off exploring the philosophy of life with some girl, but it turns out you were holed up in the library," Chen Chuan said with a look of mock heartbreak.

Xu Jiafeng was more direct. He pulled out two hundred-yuan bills and asked, "A brother is starting a business; I, Xu, must show my support. How much for the research reports on the consumer and non-ferrous metal sectors?"

"They’re thirty each, but since we’re roommates, you can have both for fifty."

Before Zhang Yang could finish his sentence, Chen Chuan asked impatiently, "Can I get them for free?"

"Of course," Zhang Yang replied with a calm smile, stating his condition: "On the condition that you bring me meals for two weeks."

"I think I’d rather pay." Chen Chuan immediately backed down. He knew Zhang Yang had a habit of eating breakfast. Having him bring lunch and dinner was fine, but bringing breakfast would be worse than death! That would be equivalent to attending 8:00 AM classes for two weeks—who could handle that?

"Consumer, banking, non-ferrous metals, and the securities sector reports—that comes to exactly one hundred," Xu Jiafeng said, handing Zhang Yang a hundred-yuan note. He knew how difficult it was to produce these reports. Back when they were taking the Market Analysis course, the professor had assigned an Excel spreadsheet project; he had struggled with it for half a week and ultimately had to beg Zhang Yang for help.

"Give me the one on the military industry sector."

"I want the infrastructure sector."

Chen Chuan and Wang Liu also paid to support Zhang Yang’s venture. Thirty yuan was not much for them—it was less than two days' worth of food money. Furthermore, they were all in finance, and the macro research report Zhang Yang had sent to the group was well worth the price. It was so detailed that it saved them a significant amount of time searching for data.

After collecting the money, Zhang Yang immediately sent the market reports to his three roommates via his 163 email account, adding an extra screening of obscure stocks as a gesture of gratitude for their support.

...

Night fell, and another heavy rainstorm hit Shanghai. A fierce wind blew, and raindrops the size of beans tapped against the dormitory balcony. By the time the lights were about to go out, the number of people who had purchased Zhang Yang’s reports reached twenty-one, bringing his net income to 1,200 yuan.

This number was not huge—it represented only one-sixth of the 122 students in the Investment Studies class—and most had bought them out of curiosity. With the 1,200 yuan added to the 800 yuan already in his stock account, Zhang Yang’s initial capital had reached 2,000 yuan. In 2009, 2,000 yuan was equivalent to a month’s salary for an average worker in Shanghai; for a student, it was a small fortune.

Zhang Yang was in no rush regarding the sales. He leisurely soaked his feet and then climbed into bed. It takes time for a bullet to travel from the chamber to the target.

While Zhang Yang slept, Lai Weijie—who sat at the bottom of the class with a 20% loss—was staying up late reading the market sector reports he had spent 300 yuan to purchase. He was Zhang Yang's first "all-access" subscriber.

Why did he buy them all? It was simple: he desperately wanted to get into Huaxin Securities. Although he was a local, his parents worked in the catering industry and had no connections in finance. Lai, who had consistently ranked in the bottom half of his class, knew that if he used conventional trading methods, he would never outperform the top students. He had to find another way.

It was precisely because of this that he had blindly trusted online rumors and went "all-in" on Rongfeng Holdings, only to suffer four consecutive limit-down days. Not only did he lose his 20% profit, but he was also down 20% of his principal. He had been ready to give up, but the reports Zhang Yang sent restored his confidence. He bought one, then another, and finally subscribed to everything.

Zhang Yang’s reports were incredibly detailed. Taking the steel sector as an example, he not only listed the top ten potential stocks but also explained the technical, fundamental, and sentiment aspects, all backed by visualized data charts. Lai did not blindly trust them; he went to verify the information himself. After comparing the data, he was struck by the terrifying accuracy of Zhang Yang’s work—not a single error was found in any of the ten sector reports.

"This is basically a 'cheat code' guide!" Late at night, after finishing the eighth report, Lai sighed in awe, realizing the gap between himself and the top students. The eight reports covered eighty stocks, thirty of which showed clear upward signals in technical analysis. While the remaining ones didn't show heavy volume, they were backed by positive news and sentiment, making them worthy of being added to a watchlist.

By the time he finished all ten reports, the sky was already beginning to brighten. It was Friday, the final trading day of the week.

At 9:15 AM, the call auction began. A-share call auctions consist of two stages. The first five minutes, from 9:15 to 9:20, allow for order cancellations and no actual trading takes place. Many people with ulterior motives or those who are simply bored will place limit-up or limit-down orders, only to cancel them at 9:19:50. However, once 9:20 hits, the system locks the orders, and cancellations are no longer permitted.

For example, if a stock closed at 10 yuan yesterday, and you placed an order for 1 million shares at the 11-yuan limit price at 9:15, if you fail to cancel before 9:20, the system will not allow you to withdraw. Every sell order will be executed at your 11-yuan limit price until your 1-million-share order is filled.

The 9:20 to 9:25 interval is for automatic trading, and the five minutes from 9:25 to 9:30 are for the market to consolidate before the official opening at 9:30. The most important function of the call auction is to determine the opening price for the day based on news that surfaced while the market was closed.

Lai Weijie did not hesitate for a second. During the call auction, he sold all his holdings in Rongfeng Holdings at a 6% loss. After the market officially opened, the automotive sector, just as Zhang Yang had analyzed, showed a clear divergence in capital. The recent spread of news regarding the "Automotive Industry Adjustment and Revitalization Plan" had caused too many retail investors to rush into the sector.

To make money, the market makers had to force retail investors to cut their losses at the bottom. How do they do that? The simplest and most brutal way is to smash the stock price. But because the automotive sector was so large and buoyed by favorable policies, a violent crash was unrealistic. In such cases, market makers use a "dull knife" approach.

First, they smash the price through the so-called support levels, then slowly oscillate sideways, grinding down the patience of retail investors while performing intra-day "T+0" trades to lower their own cost basis. Finally, they break the sideways trend downward before staging a "V-shaped" recovery.

The "dull knife" works on retail investors because they share a common trait: they believe in technical indicators. In reality, for market makers of small-cap stocks, any technical indicator—such as golden crosses, dead crosses, turnover rates, or volume—can be manipulated.

"Capital divergence, main force fleeing, yet retail volume is increasing; it is indeed entering a technical sideways phase." Lai watched the screen intently. The moment the minute-line turned upward, he decisively used all his funds to buy into JAC Motors. The simulation account tracked the real market, but since it didn't affect the real market, he didn't need to consider capital variables.

After the minute-line dipped another 1.4%, the market makers finally began a massive push. By the close of the afternoon, JAC Motors was up 3.4% with a 7.9% amplitude. The single-day profit restored Lai's confidence. With over a month left, it was entirely possible for him to make a comeback and break into the top ten.