Young People Rush into Financial Market in China

  • Young people learn to invest by following vloggers on Bilibili.
  • Peer pressure and envy drive people into the financial market.
  • Reports say over 40% investors are losing money.

A recent report by Tencent shows that in China, over 84% of post-90s (people born after 1990) are doing some sort of personal financial planning (PFP), especially investing in the stocks and the funds. It’s like suddenly, everyone is talking about “Baijiu” (a Chinese liquor), one of the most speculated funds during the last year along with medical stocks.

Trending topics of funds on Weibo (source: Guyu).

Post-90s’ first experience of PFP is at least 10 years earlier than their parents, according to a savings report by China Institute of New Economy.

On Bilibili, China’s leading video sharing website, among the most popular videos on the main page, you can always find some vloggers talking about their success and knowledge about investment. Many financial market newcomers begin their journey with these tutorial videos. Mouth to mouth, the risks of investment seem to have decreased infinitely, while the profits become a certain thing.

Although their money is hard earned, the sweet dream of changing their life fast and easy still urges them to rush into the market. However, it’s unsettling.

Statistics show that 41.6% of young investors check on their gains on a daily basis. On Douban, posts about losing money take up 60% of all related topics. Everyone is looking at going up, but obviously falling down is way more common.

Investment videos on Bilibili.

“For many young people, the only wish is to get rich before 35 years old and retire young.” However, unlike the FIRE (Financial Independence, Retire Early) movement, instead of adopting a lifestyle with an aggressive savings rate, they throw their money into the financial market even though they have no idea what all those technical terms and curves mean.

They are the perfect “jiucai”, a Chinese word for garlic chives, a phrase widely used in China to describe individuals who rush into the financial market without proper knowledge and experience. The market is like an experienced farmer who takes care of jiucai and waits for it to mature. When the time comes, the market just harvests all the jiucai with no mercy.

Jiucai are the perfect victims of the market.

Tencent Stocks revealed that in 2020, winners and losers in the financial market are basically 60-40, a reflection of the unpredictability of the financial markets. “Everyone thinks that he’s following the right guide or vlogger, that his information is quicker and better. But on a large scale, there is simply no way for an all-win result.”

On Zhihu, under threads asking why funds are so popular lately, lots of answers are a bit alarming. “I wasn’t interested in funds at all. But I just felt like I was left behind if I didn’t participate and all my friends seemed to be getting rich. Peer pressure beats you up. Sometimes I have nightmares that I’ve lost all my money.” Stories like this makes you wonder if another bubble has just arrived.

GNAF

Just another attempt to show a more real China.

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