Economic Daily: The Surge in New Share Subscriptions Requires Rational Judgment

The price of a new stock on its first day of listing is greatly influenced by market sentiment and short-term supply and demand. It can be driven up by optimistic market feelings or pulled down by a concentrated sell-off in the short term. Therefore, the price on the first day of listing cannot be regarded as a stable reflection of the company's value. It may be more useful to look at the expected returns of new stocks from a longer time perspective. Continuous performance, stability of cash flow, and the true position in industry competition are elements that concern a company's core value, and they often require a certain period to be assessed. While short-term gains can be attractive, the market's long-term returns ultimately come from the growth and profitability of the business. When more and more investors understand this, the enthusiasm in the new stock market can transform into long-term support for quality companies.