Trailblazers in Reform: Views of a first-generation Chinese retail investor
Updated 16:38, 29-Nov-2018
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It's been 40 years since China opened up its economy and it's been about two decades since China established its own capital markets.( Despite growing pains, the country's investment platform has experienced tremendous growth. More and more people in China are becoming comfortable with the concept of investing. On a recent trip to Shenzhen, the city that kicked off China's reform and opening-up process, CGTN's Tracey Chang sat down with Wang Wei, a FIRST generation Chinese investor, to talk about his views on the past and future of China's capital markets.
An avid golfer, seasoned investor, teacher, mentor, Mr. Wang Wei leads a "slash career" that mirrors the ambition of many current day millennials. Born in 1955, Mr. Wang was among the post 50th generation of Chinese youth that underwent one of the most tumultuous times in China's modern history. Despite the obvious historical challenges, Wang told me that he was the first generation of Chinese high school drop-outs to attend college post the Cultural Revolution.
WANG WEI INVESTMENT PROFESSIONAL "I was the among the first generation of Chinese students to take the college entrance exam. At the time, the people who took the test were all very determined. People were yearning for a brighter future. They returned to school. My classmates had age gaps of over 15 years. It was an unusual time indeed."
His post-graduate career was smooth. A telecommunications major in college, Wang landed a job at one of the biggest state-owned telecom giants - a job at the time that made many of his peers envious.
WANG WEI INVESTMENT PROFESSIONAL "That job was very good. And of course many many people were envious, but in my heart, I knew I wanted a little more."
Feeling complacent at his prestigious yet mundane SOE gig, Wang attended a class in 1991 to learn about capital markets and investment. Soon after, he started working on an investment project that at the time almost no one understood.
TRACEY CHANG CGTN "Tell us about when you first made the decision to 'throw away your iron bowl career' to dive into an unfamiliar territory that is the capital markets. At the time in China, how did your family react? Were people supportive or were they perplexed by your decision? What did they think?"
WANG WEI INVESTMENT PROFESSIONAL "I'm lucky that I could do both. Because at the time no one knew what I was doing. I have to thank my wife and my family. They actually supported me. People thought I was crazy to try to be an 'investor' because they had no idea what 'investing' was."
Just like that, Mr. Wang became a member of the first generation of Chinese investors. But that road was not a path for the faint-hearted. The Chinese capital market, despite its relative short history in its modern form, has experienced tremendous growth since its early inception in the early 1990s. And just like all other major capital markets around the world, China's investment platform had her own growing pains. The most recent market rout came in the summer of 2015 when a third of the value of A shares on the Shanghai Stock Exchange was lost in less than a month. Mr. Wang spoke of living through that market calamity with aberrant calm.
WANG WEI INVESTMENT PROFESSIONAL "When the market went down, there were actually expectations. The downturn did not come from nowhere. I was unfazed because market troubles like this happened before and it will happen again. The people who are in real trouble are the ones who don't understand investment and they get dragged into the whole thing hoping to make a quick buck. They did massive margin financing, became greedy. It was never the system's problem. It was always the people's problem."
Wang says he has passion for investing, and the passion stems from his strong moral compass and long-held life principles.
WANG WEI INVESTMENT PROFESSIONAL "I always tell my students that before you learn how to be a good investor, you have to learn how to be a good person. I advocate investing through one's conscience. I'll never compromise my principles for material gains and that's probably the most vital investment lesson I can teach anyone."
Under the moniker "Middle Hawk", or "ZhongZhengYing" in Chinese, Mr. Wang gathered a sizable following online. With nearly 700,000 followers on China's twitter like platform Sina Weibo, Mr. Wang travels around China holding seminars teaching Chinese retail investors. His students are from all over the country, and many of them have been following Mr. Wang for years. Fondly calling Mr. Wang "XianSheng", which is an ancient Chinese way of addressing one's "master teacher", almost all of Wang's students echoed his idea of "investing through one's conscience".
INVESTMENT SEMINAR ATTENDEE Student one: "He taught me how to be a good person before he taught me how to be a good investor. He is a positive energy in China's markets today where a lot of people frankly don't have much confidence."
INVESTMENT SEMINAR ATTENDEE Student two: "I want to learn investment because I want to achieve financial freedom. But I want to do it the right way. So I learn from him."
M.r Wang also has a lot to say when I asked him about the biggest challenges facing China's capital market development.
WANG WEI INVESTMENT PROFESSIONAL "We have to keep the markets healthy. Just like a person who absorbs nutrients via consuming fresh foods and gets rid of wastes through defecation, our markets need a mature standard delisting process. By getting rid of zombie enterprises, newer and more vibrant companies with promising futures can enter, and bring financial success to our investors."
We also had lengthy policy discussions where Mr. Wang told me he thinks it's almost inevitable that China's massive pension funds will soon enter the country's capital market.
WANG WEI INVESTMENT PROFESSIONAL "Look at the most matured capital markets in the world. Look at the US. How do people do pension funds? They do it through investment. Everyone in the US has a 401k. But of course, we have to do it carefully because it's about people's livelihoods. We have to have proper regulations in place."
Looking into the future of China's capital market, Wang struck a rather optimistic tone, telling me that he has full confidence in the government determination to further open up and develop China's capital market while safeguarding the country's financial system.
WANG WEI INVESTMENT PROFESSIONAL "I fully believe in our policymakers' ability to manage the system. We will open up further and our investors will become more sophisticated. China's future as a financial power is bright. The process will not be finished overnight but our government has the best decision making process to take us there."
TRACEY CHANG CGTN "The tide of reform and opening up of China's economy have laid a foundation for the emergency of China's capital markets. After 20 years of practice, and with the help from people like Mr. Wang Wei, Chinese retail investors had made tremendous progress towards maturity."
TRACEY CHANG, SHENZHEN, CGTN.