Great opportunities are often born from disagreements: To understand gold and copper, first understand who is trading.

``` Content of this Issue Thank you very much for the opportunity to meet everyone here today. I want to spend two or three minutes briefly describing the goal for today’s lesson. Frankly, I don’t think of myself as an especially good teacher, but I hope that after a few hours today, everyone will understand something very important: No one comes to the market intending to lose money. No institution comes to the market claiming to be here to lose money. When individuals face the same set of data, their interpretation of information differs because of the nature of their funds and their institutional structures. However, this doesn’t mean someone is wrong. Let me give an example from the commodity market. If you’re a producer, when prices are high, you might choose to hedge by opening a short position to lock in profits. But this doesn’t mean you’re not bullish on prices. You may still be bullish, but feel, for example, that your company making half a billion this year is already very good, so you just lock in your profits. There’s no right or wrong here. Another example is some CTA strategies. When the trend is strong, they continue to go long. You might ask: “The price has already gone up 30%, why open a long position?” But they’ll tell you: “Seventy or eighty percent of my strategy is trend-following, so in this situation I won’t go short.” So often, there is no absolute right or wrong. It’s hard to find a professional institution that will admit they’re “completely wrong.” Different groups of traders start from entirely different positions. Therefore, we hope that after today’s hours together, everyone will have a basic understanding of the main trader groups for gold and copper. In commodities, these are the two products I know best. If we can achieve that, it’s already quite good. When you see gold and copper prices daily in the future, I hope you can do two things: First, roughly judge whether the price is at a relatively high or low point. Second, understand what different traders might be thinking when facing this price. The truly difficult decisions are right here. From my experience, almost never, when you see market movements, are you one hundred percent certain that you will make money. Most of the time, you hesitate: there might be three or four different logics at play, but which one do I trust? Which group of investors do I align myself with? These choices are difficult. But often, this hesitation itself is precisely the precursor to a big opportunity. Because if there is no disagreement in the market, there won’t be large positions; without large positions, there won’t be large volatility; without large volatility, there won’t be major market moves. So it’s precisely these seemingly tangled disagreements that create many excellent investment opportunities. Therefore, understanding the disagreements is more important than deciding who is right or wrong in the moment. In today’s lesson, I will also share many experiences of past successes and failures so everyone can learn some lessons from them. If there’s one thing I’m grateful to WallstreetCN for, it’s that they provided a platform where we can talk about past mistakes. Because personally, I don’t really like those “absolutely right people.” If someone tells me they’ve hardly ever made any mistakes in their life, or their investing has always been correct, I actually feel a bit uncomfortable. So I don’t want to become that kind of person myself. In today’s sharing, I will talk about some cases from the past few years. Some judgments had very solid logic at the time, seemed reasonable, but we still made the wrong choice. I’ll also explain, looking back, what caused those mistakes, and what we were thinking at the time. This is basically the purpose of the course. In terms of course structure, we made a simple design. The morning session is more theoretical and relatively dry; the afternoon is more case analysis. This is also considering everyone’s attention span. Since the course is quite long, I’ll try to stick to the scheduled time. If we finish a little early, we can also chat about some current market views or future outlooks. That’s the plan for today’s course. Next, I’ll spend two or three minutes briefly introducing myself. I first entered the commodity industry in 2015 to 2016, which happened to be a difficult period for the industry. At that time, I was working on mining-related mergers and acquisitions. Looking back now, it was a mixed blessing. The good side is that doing M&A during the industry’s worst period makes it easier to encounter truly outstanding companies. For example, in 2015 and 2016, some notable M&A cases included Zijin Mining acquiring the Kamoa Copper Mine and China Mineral Resources attempting to acquire a gold mine. Through these projects, we got to know many excellent mining companies capable of contrarian M&A. But the downside was obvious—the whole industry’s prices were very low at the time. Doing M&A during the toughest period meant asset prices were also extremely low, so the overall environment was harsh. After those years, we went to a brokerage research institute to do macro and commodity research. This was logical because in 2015 and 2016, most commodity M&A involved copper and gold. My first task was to convince a state-owned enterprise boss. He spent at least 30 minutes making us prove one thing: that gold could rise $50 in a year. At that time our forecast was $1150. His logic was simple: the all-in production cost of gold was about $700, and he said, why is it that after gold rises from $1000, $1050, to $1100, it can still go up to $1150 when the cost is only $700? I'm not citing this to comment about that leader, but to say: People often underestimate changes in long-term price variables. So we need a framework to understand this. This January, I watched gold rise 1%—that is, $50—within a minute. It really felt like a different world. Later in the brokerage, in order to understand the volatility of gold and copper, we started to study more economic questions. If you recall, in 2016 copper basically tracked China’s PMI and the SSE 50 Index, while gold tracked real interest rates. I didn’t understand either at the time, so we spent a lot of time studying business cycle content. In the fourth part of this PPT, we’ll share: how, during this research process, I learned all sorts of business cycle theories, and ultimately gave up the “just use economic cycles to observe the world” approach. Because I only gradually realized through repeated mistakes: that framework is not complete. The last time in my career I worked for someone else was at Zijin Mining. We helped them with commodity price research used for investment and hedging. It’s a truly great company. Although I’m no longer a formal full-time employee, I’ll briefly share why I think it’s very good. Of course, this does not involve any investment advice. If you ask me honestly, I think its best growth and most elastic phase is probably already over. But how it achieved that is still worth sharing. That’s basically my own experience. Before ending my self-introduction, I want to mention one thing I really hope to discuss with everyone. Today in this lesson, everything we share is essentially some techniques, some research methods. These techniques are very useful—whether for making money or supporting a family, they are great tools. But if you ask me, throughout all these years, what really determined our returns? I’d say: it’s our values, our outlook on life, those things learned as a child—honesty, kindness, courage. I know this sounds a bit vague, but I still hope that after these four hours, or after today, you can understand one thing: Methods can change at any time, but a person’s basic qualities, values, and morality are the things that truly determine returns. If I can, through my experiences, help everyone resonate with this, I think that would be today’s greatest achievement. More Course Content Risk Warning: MasterClass selects third-party compliance professionals to teach research theory courses on the platform. The content delivered does not constitute advice to buy or sell any specific product or investment. The opinions expressed in the platform courses are for learning and reference only, do not represent WallstreetCN’s views or opinions, and do not address users’ specific investment goals, financial status, or needs. Markets are volatile and uncertain; the platform does not assume responsibility for any losses suffered as a result of relying on course opinions or information. Investing involves risks—please make prudent decisions. ```