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What's the best way to familiarize myself with the financial market?

I want to be in finance because I am really good with numbers and love math, but I have trouble understanding the financial market. #finance #financial-services #investment-management #investing #public-speaking

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Dan’s Answer

Michael Lewis is a great writer and boils down complicated finance topics in a really entertaining way. Some of his books that I really enjoyed and that would help you understand finance better: The Big Short, Boomerang, Flash Boys, Liar's Poker. You might know this already, but The Big Short got turned into a movie last year and was nominated for Best Picture.


Also, try to reach the Wall Street Journal occasionally and you will find that you will start picking up on the lingo of finance more and more. You can eventually add The Economist as another magazine that has great info on the markets as well as politics and business.

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Mark Jason’s Answer

A great place to start would be to understand fundamental analysis. An excellent first read would be "The Intelligent Investor" by Benjamin Graham. Benjamin Graham was the father of "Value" investing and one of the greatest investors of all time. You can also never go wrong from learning from one of his star students, Warren Buffett. Anything that you can get your hands on that is written by or written about Warren Buffett will be valuable.

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Simeon’s Answer

There are free resources like the ones on yahoo.com that can help you familiarize yourself with the current market and Two Cents on YouTube that can teach you a lot of the concepts. I'd also recommend a free subscription to the Morning Brew newsletter. They do a great job of summarizing the market news in a relatively small and compact newsletter that is very reader friendly. They also have more specialized newsletters depending on if you have interest in specific industries, such as retail or tech.
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Moulya’s Answer

Michael Lewis is a great writer and boils down complicated finance topics in a really entertaining way. Some of his books that I really enjoyed and that would help you understand finance better: The Big Short, Boomerang, Flash Boys, Liar's Poker. You might know this already, but The Big Short got turned into a movie last year and was nominated for Best Picture.

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Vandana’s Answer

Danny,


Very few people are really good with numbers and love math. You are one of those blessed few!


How about-
1. Getting a mentor
2. Watch youtube videos on the topic- financial market
3. Read Linkedin profiles of successful Finance professionals to figure out the skills / competencies required
4. Read articles on this topic and join Linkedin Groups to keep abreast of the latest trends in Finance domain


Danny, you have tremendous potential. Have a great career!

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Daphne’s Answer

A good start is to learn terminology and understand how businesses behave. Is there a library nearby? I suggest you check out the Wall Street Journal. Most libraries have a copy of the Wall Street Journal that members can read while at the library. Reading the whole paper will take a while but the front page summarizes the articles. The Wall Street Journal is good at explaining more technical terms and concepts. If you read the Wall Street Journal for five minutes or one hour, you are likely to learn something.

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Gabriel’s Answer

Hi Danny,


Thanks for the question. I'd like to recommend three books that I currently own (including two of which that helped me through my MBA):


Financial Intelligence (Revised Edition) by Karen Berman and Joe Knight


Finance Basics for Manager published by Harvard Business Review


Investing for Dummies by Eric Tyson


Any or all of these books will give you a good foundation to understand "the basics". Once you understand them I'd recommend taking a few free or low-cost courses like:


Finance for Non-Financial Professionals: https://www.coursera.org/learn/finance-for-non-finance-managers


Finance and Capital Markets: https://www.khanacademy.org/economics-finance-domain/core-finance


There are many other books and courses available, but I wanted to give you what I believe is a good place to start on exploring the field of finance.

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Vijoy’s Answer

First thing I would do is familiarize myself with Discounted Cash Flow (DCF) analysis (search up both the Weighted Average Cost of Capital method and the Adjusted Present Value method) and Leveraged Buyouts (LBO). Banks/private equity firms will be doing this kind of stuff all the time. I didn't mention comparables company analysis since it isn't really financial modelling but it is very common also.


Investopedia has a good intro to how a DCF works: http://www.investopedia.com/univ...


There are paid online courses that will teach you modelling such as http://breakingintowallstreet.co..., http://www.wallstreetprep.com and http://trainingthestreet.com/. I believe some banks will actually put their analysts through the Training The Street program.


Investment Banking: Valuation, Leveraged Buyouts and Mergers and Acquisitions by Rosenbaum and Pearl is a good book to read. Its more practical than academic.


There are some good free resources also:


http://macabacus.com/ provides a good overview of different types of models with MS Excel templates you can download.


NYU Stern Prof. Aswath Damodaran has a good site where he shares financial model templates and a lot of other things. http://pages.stern.nyu.edu/~adam...


This will be a little harder to follow than macabacus since it doesn't actually walk you through the process of creating the model. But you can look at them to get a sense of how to structure a model and what sort of inputs are needed. His models are perhaps a bit too "academic" and detailed for practical use.


Lastly, if you look hard enough there are pdf files floating around the internet of internal valuation and DCF handbooks used by the large investment banks. These might be hard to find, they're often on Chinese file sharing sites.

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Yasmeen’s Answer

All great suggestions above! In addition, you can check out Bloomberg radio and also CNBC news channel. Hearing professionals discussing the markets is another way to get comfortable with the lingo.

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