BEIJING, May 26 -- Euphoric investors intoxicated by the surging Chinese stock market should be aware that discretion is the better part of valor.

Jitters rippled through the market when online video company Letv announced on Monday night that its CEO Jia Yueting would sell 148 million Letv shares worth around 11 billion yuan (1.8 billion U.S. dollars) in the coming six months.

Letv's share price has risen fivefold in five months and the ChiNext startup board, on which it is listed, has hit a record high. Experts believe Jia's move suggests the company's acknowledgement of its inflated valuation and the urgent need to lock in profits.

Letv slumped 8.3 percent at the opening of Tuesday's trading, evidence that the news dented investor enthusiasm.

"A huge sell-off will surely bring about repercussions to the whole board," said noted economic commentator Song Qinghui, noting that factors such as the board's overly high evaluation and stricter government oversight will no doubt cause volatility.

The Chinese stock market has seen an impressive rebound since the second half of 2014 after being stuck in the doldrums for about six years.

The government has lauded the rally, believing it serves the twin purposes of providing funds for small businesses, which are usually denied bank loans, and helping state-owned enterprises pay debts.

The seemingly unstoppable run on the stock market has attracted more and more investors, with millions of new accounts opened every week since March. Headline-grabbing stories include housewives choosing to drop their old hobbies of square dancing to jump on the stock bandwagon.

However, the steep rise of share prices has fueled concerns that caution has been thrown to the wind. The Securities Regulatory Commission has issued warnings over accumulating risks on 10 occasions already this year.

ChiNext-listed companies boast an average price-earnings (PE) ratio of more than 100, indicating a speculative bubble. For example, shares in Baofeng Tech., a small online video firm with lackluster first quarter performance, surged more than 2,000 percent to around 250 yuan per share from 7.14 yuan in March.

As the share prices have become incommensurate with the companies' fundamentals, selling off and securing profits is an irresistible attraction for big stake-holders, which can hurt small investors as share prices subsequently nosedive.

In January, the sell-off of 348 million shares of the Shanghai-listed CITIC Securities, worth 11.4 billion yuan, saw its share price drop by the daily limit of 10 percent for two consecutive days.

The whole brokerage sector was affected by this and it was said to be one of the main reasons the Shanghai Composite Index slumped by 7.7 percent on Jan. 19.

However, as economic pundits have often joked, even bad news can be interpreted as good news for the Chinese stock market these days. For example, investors are accustomed to shrugging off poor readings of economic data, thinking they signal more easing policies.

Letv clawed back lost territory in the afternoon's trading and ended the day down a marginal 1.9 percent.

Song's pessimistic observation of Letv's bad influence on the startup board has proved inaccurate also, at least for now, as the ChiNext Index surged by 4.33 percent.

Combined turnover on the Shanghai and Shenzhen bourses hit a record 2.15 trillion yuan from 2.03 trillion yuan on Monday.

It seems that investors' lust for fortune has again gotten the better of caution.