Filmmakers have been making movies about finance for years. Some, such as “Trading Places”, humorously depict turmoil on the trading floor. Others, like “The Wizard of Lies,” are sobering representations of real events.

While these movies are fun to watch, few of them contain actionable advice that investors can follow after leaving the theater. But there are a few notable exceptions. No movie can fully educate beginners on this subject. details of the stock exchangebut it contains a few tips, some of which may be valuable to those hoping to enter the world of finance.

(Of course, if you’re looking for real financial advice for your particular situation, talk to a financial advisor.)

Here are our top picks for stock market and Wall Street movies every investor should watch. Each of them straddles the line between education and entertainment and does not compromise on either.

1. Wall Street (1987)

“Wall Street” may seem like an obvious choice when it comes to movies about the stock market. More than 35 years after its release, it still gives viewers something to think about after the credits roll. The story follows young stockbroker Bud Fox (played by Charlie Sheen), who works under morally dubious Wall Street trader Gordon Gekko (played by Michael Douglas). The film is known for Gekko’s famous speech in which he says “greed is good”.

Sheen’s character climbs the ladder of success to do good by illegally sharing insider tips with Gekko. It works for a while, but he inevitably runs afoul of the U.S. Securities and Exchange Commission (SEC) and ends up getting arrested. insider trading.

This may seem obvious, but investors would be wise to heed the movie’s lesson for those in finance: Don’t be so blind to breaking the law to get ahead out of greed and ambition. It may provide you with a favorable financial position in the short term, but the law will inevitably catch up with you.

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2. The Wolf of Wall Street (2013)

“The Wolf of Wall Street” is notable for several reasons; The most important of these is that it is based on a true story. This depiction of real-life stockbroker Jordan Belfort is based on his 2007 memoir of the same name. The film follows Belfort’s rise from an innocent young merchant to a predatory con artist.

Directed by Martin Scorsese, the film stars Leonardo DiCaprio as Belfort, who becomes involved in every vice known to man while getting rich from his criminal behavior. Among the crimes, pump and dump schemeA type of securities fraud that involves illegally hyping overvalued stocks to unwitting investors for the purpose of artificially “increasing” the stock price. This activity eventually costs Belfort his freedom.

Even though the movie is set in the 1980s and 1990s, investors can apply its lessons to today’s investments, especially when it comes to cryptocurrency. Blockchain data platform Chainalytic launches in 2023 a study This revealed that 24 percent of new tokens launched in the previous year bore similarities to pump-and-dump schemes. These tokens were sold at high prices by their creators, and some experienced a 90 percent drop in value.

For cryptocurrency investors “The Wolf of Wall Street,” in particular, can serve as a powerful reminder to do your due diligence before making any investments.

3. Big Short (2015)

The 2008 financial crisis did not happen overnight. Rather, it was the result of a number of factors. The details of what led to the financial crisis are detailed in the book “The Big Short: Inside the Doomsday Machine,” which was published in 2010 and later adapted into a movie in 2015. The book follows real-life hedge fund manager Michael Burry (played by Christian Bale). ) was one of the first to realize that many US homeowners bought their homes through subprime loans. housing bubble.

Don’t worry if you don’t know some of the terms used to describe the causes of the housing bubble. The movie uses celebrities to explain concepts and terms such as: mortgage-backed securities. Stars such as Anthony Bourdain, Margot Robbie and Selena Gomez break the fourth wall throughout the film and speak to the audience in a language free of financial jargon.

Of course, if you are an experienced investor, you probably already understand the dangers of subprime loans. However, if you are a novice and still trying to understand all the factors that caused the 2008 financial crisis, “The Big Short” makes it easier to grasp a complex problem that few people saw coming.

In conclusion

If you’re planning a career in finance, there’s no substitute for a real education. But some movies can offer wisdom to investors, or at least serve as a reminder. Some of the big mistakes to avoid. So do your due diligence and learn about finance from reliable sources; But if a movie can help you understand something better than what you learned in business school, that works too.