Will studying for CFA or Series 7 teach me about investing?
I'm a high school student trying to learn how to invest in stocks. In addition to reading investing books, should I look at the online study materials for CFA Levels I-III and study materials for Series 7 Exams?
No.
The series 7 is about securities regulations. That's not (completely) worthless stuff to know but it will not make you a better investor.
The CFA is academic finance and most of that is worthless.
Source: CFA Charterholder and one time series 7 holder.
If you want to learn how to invest, try to get access to write ups from SumZero or VIC and read some of the classics. That will give you the basics and be a far better use of time.
You may do both of those eventually, but wait until you finish college. Start reading quality news and follow a few companies closely. If you have some money of your own to invest, start doing that now. If you are interested in bonds or derivatives, maybe make a fake money account and try trading them a bit. I think Khan Academy might have some good videos covering some basics of finance as well.
No. What you need to understand is that there is no right or wrong way to invest. You need to find what works for you, they will teach you the concepts of evaluation a business, weather that helps you or not is up to you. The series 7 is just a test proving that you know the terminology of stocks & options.
definitely open a brokerage account as soon as you can. investing with real money is a ton different than virtual money
Seriously take a year or two to develop a strategy and paper trade it. Dont nose dive into the pool before you can swim.
series 7 you need to be sponsored, and for CFA you need applicable experience before you can be a charter holder even if you pass all 3 levels.
Both these things are going to be pretty abstract, i suggest investing a small amount of real $, you will learn much quicker that way. my personal opinion
You want to invest, good place to start is to read Peter Lynch's One up On Wall Street and The Intelligent Investor by Ben Graham. After you got the basics, sky is the limit.
I started investing just last month, I bought at&t and pfizer, but then i sold them after they went up a little because i panicked and wanted to wait to learn more before seriously investing.
If there's anything you'll ever learn about investing, its controlling your emotions and not panicking at the wrong time. If you buy strong companies like PFE and T, then you need to train yourself to buy MORE on the dips, not sell. You had the right idea, but if you don't want to get taxed a shitload on capital gains, aim to hold your investments for at least 1 year. You won't get rich quick doing this unless you have 6 figures to play with, which I'm guessing you don't. Buy and hold my friend. Patience is a virtue.
That's good advice. Almost everyone makes similar mistakes when they are starting out. If you start in large caps with a small dollar amount, it's hard to blow yourself up too badly. Since you're going to make mistakes (which is just part of learning anything, but especially how to invest), you want to focus on doing the least possible damage, NOT on getting rich. Focus on how much you might lose if you're wrong, and then start to think about how much you have to gain, not the other way around. Good value investing is a lot harder than people make it out to be in my opinion.
My advice on that note is to try to track out some of the largest and best known blue chip hedge funds (Baupost, Greenlight, Pershing Square, Third Point, etc.) and create a super fund index of their holdings. Whale Wisdom and some other sites allow you do stuff like this at low cost. You will notice that a lot of these funds have to invest in large cap stocks due to their large asset bases (buying a $100mm stock does not move the needle for them), and many of the funds seem to end up owning the same stocks at more or less the same time (not 100% overlap of course). In my own observation, there may be something like 30 or 50 large cap "value stocks" that are owned by many funds. These would be good stocks to watch and understand, and possibly even invest in. Most large caps are pretty efficiently priced most of the time, so if several big funds own them, then they are worth looking at.
Good investing requires doing a lot of things that feel unnatural at first (they call it contrarian for a reason), so focus on not hurting yourself -- you have plenty of time, the money will always be there waiting to be made, and you can ease into it given that you are starting at a young age. No need to swing for the fences out of the gate. Just my $0.02.
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