Mid-2025 Investment Summary - Harvesting gains in Hong Kong stocks, steady performance in US stocks, and a hot IPO market in Hong Kong

Unknowingly, the first half of the year has passed. Today, on the weekend, I took some time to summarize my half-year investment performance. Compared to last year, the first half of this year hasn't changed much. I still focus on the concept of 'globalization' in my investments. These three words are actually very important. If you understand them, I believe investing will become much easier. The difference this year is that IPO subscriptions in Hong Kong stocks have been quite hot, and I’ve also participated deeply in them. For me, IPO subscriptions have become a risk-free or low-risk arbitrage opportunity.

1. Global Asset Performance in the First Half of 2025

Let’s start with the data. Below are the top 20 global stock indices for 2025: South Korea ranks first, while the Hong Kong Hang Seng Index ranks 7th with a 20% increase. U.S. stocks have recently hit new highs and are still on the list, while China’s A-shares lag far behind. Now you understand what I meant by 'globalization' in investing earlier. Without grasping these three words, investing is difficult—at least in recent years. To invest, you must first avoid being a frog in a well. Look beyond your own market to identify truly excellent companies. Don’t be fooled by domestic propaganda like 'far ahead.' Invest in excellent companies wherever they are. If you don’t understand foreign markets, at least many excellent domestic companies are listed in Hong Kong!

From what I’ve seen, most people had decent investment returns in the first half of the year—as long as they bought Hong Kong or U.S. stocks. Hong Kong stocks rose 20%, and U.S. stocks hit new highs after already being at record levels. I run two communities, one of which has nearly 500 members, 80% of whom have about six months of investment experience. I conducted a poll via a mini-program, with around 135 participants. The results showed that 80% of them made money in the first half. Most profits fell in the 10%-30% range (29% of respondents), while over 10% achieved returns above 50%. So my conclusion for the first half of the year is: As long as you didn’t blindly buy Hong Kong or U.S. stocks, it was quite easy to make money! Even if you bought Nvidia at 140, you’d still be profitable!

2. My Mid-2025 Report Card

I manage several accounts, with one focused on Hong Kong stocks and the others mainly on U.S. stocks. My trading activity in the first half wasn’t particularly high, but my Hong Kong stock returns outperformed U.S. stocks.

2.1 Mid-2025 Hong Kong Stock Summary

My gains were largely due to Xiaomi, which I bought five years ago, and Tencent, purchased two years ago. Xiaomi has now grown fivefold from my purchase price, while Tencent’s shares have reached the 500 HKD mark. Although Tencent’s direct stock return is only about 40%, combining it with sell puts and covered calls has been highly successful—almost 100%—so the options income has exceeded the stock gains. (For details on options trading, refer to my earlier article: Tencent 2024 Q3 Earnings Review—Nothing Special, So Let’s Sell Some Options.) My overall Hong Kong stock return for the first half was around 40%, and I’m particularly satisfied that every month was profitable—even on April 17, when Hong Kong stocks plummeted, and my portfolio dropped 17% in a single day, I still ended April in the green. Looking at my Hong Kong stock returns from last year to the first half of this year, they’ve now reached 140%.

For other Hong Kong stocks, I bought some SUTENG. Meituan was purchased in July. I also participated deeply in IPO subscriptions, which I previously avoided due to the hassle and low allotment rates. This year, I researched and found that during good market conditions, it’s possible to make small risk-free profits. Some IPOs are almost guaranteed to be profitable if you get an allotment, like Mixue Bingcheng, Coconut Water, CATL, and Hengrui Medicine—going all-in on these is generally safe. I thought Haitian was also a sure bet, but it ended up breaking below the issue price, though losses were minimal. Overall, IPO subscriptions in Hong Kong were profitable. My strategy is to avoid uncertain IPOs or just dabble with cash, while going all-in with margin for high-certainty ones. My main account’s IPO subscription income was around 28,000 HKD in the first half—not huge, but almost risk-free arbitrage. Below are my main account’s IPO subscription results and key Hong Kong stock holdings:

2.2 Mid-2025 U.S. Stock Summary

My two U.S. stock accounts’ first-half returns are shown below:

U.S. stocks experienced a sharp drop in the first half but have since rebounded entirely—truly impressive. My current U.S. holdings are mostly in Chinese concept stocks and the 2x Google ETF GGLL. I’ve sold off other individual stocks. My trades were mainly in familiar tech stocks, like the 2x Microsoft ETF MSFT, 2x Nvidia ETF NVDL, TSMC, Micron, and MARA. Many of these were bought at lows, expecting further adjustments, but I didn’t sell at peaks, so returns weren’t as good as Hong Kong stocks. U.S. stocks are just too strong, and I’m relatively conservative.

3. Outlook for the Second Half

Hong Kong and U.S. stocks outperformed expectations in the first half, and I’ve already hit my full-year 20% target. The second half will likely be tougher, as both markets have risen significantly, and valuations for quality stocks are no longer cheap. For example, Tencent is at 500 HKD, Microsoft’s P/E is nearing 40 at new highs, and Nvidia is around 160. So the second half will require more patience and searching for emerging companies. Holding cash for Hong Kong IPO subscriptions is also wise.

Among Hong Kong giants, Meituan has fallen below 120 HKD due to competition from JD.com and Taobao. I see this as a buying opportunity and recently started a position. Meituan will likely sacrifice profits to compete, similar to its battle with Douyin. Wait for the market to digest this and see how the competition plays out. If Meituan wins, the second half will be a good time to buy. Another stock I’m watching is SUTENG, which makes LiDAR. Demand for LiDAR will grow with autonomous driving adoption, and it’s still in its growth phase. Other Hong Kong stocks need further research, and I’ll continue IPO subscriptions in the second half. For U.S. stocks, I’m holding GGLL, which pays dividends four times a year. Otherwise, I’m waiting for a U.S. market pullback—every correction is an opportunity!$XIAOMI-W(01810.HK) $TENCENT(00700.HK) $MEITUAN(03690.HK) $Direxion Daily GOOGL Bull 2X Shares(GGLL.US)