Discover the world of investing, learning how to make informed financial decisions and manage portfolios. Whether you're an aspiring Financial Analyst, Investment Banker, Portfolio Manager, or Private Wealth Manager, this information can help you understand various aspects of investing, likely timeframes for learning, and potential career paths.
Key Insights
- Investing involves dedicating money to purchase assets that increase in value over time. It's an important skill for Financial Analysts, Investment Bankers, Portfolio Managers, and Private Wealth Managers.
- There's more to investing than just dealing with stocks. Other investment opportunities include bonds, funds, trusts, private equity, real estate, and even unusual assets like cars, handbags, and watches.
- On average, it takes between one and five years to grasp investing and understand the stock market, with key learning areas including research, fast-paced decision making, and growing market knowledge.
- Factors that can affect this learning period include the degree of hands-on practice, emotional control, prior financial experience, and individual learning speed.
- Investing can be a challenging skill to learn due to the high level of variables involved. However, setting clear goals and understanding financial concepts can help ease the learning process.
- Noble Desktop offers a range of investing and financial classes, designed to cater to different learning styles and schedules, providing students with knowledge from expert instructors.
Like many aspiring Financial Analysts, Investment Bankers, Portfolio Managers, and Private Wealth Managers, you may want to learn to invest but worry about how long it will take. With all the moving parts of investing, it can be challenging for beginners to keep track of the research and market changes. On average, experts agree it will take an individual between one and five years to understand the stock market. However, the length of time it takes depends on several factors. Keep reading to learn about how you can learn to invest with various resources to help speed up the learning process.
What is Investing?
Investing is dedicating money to purchasing assets that increase in value over time. The main function of investing is to generate returns from invested assets. Investors can invest in several kinds of investments, including stocks, bonds, funds, trusts, private equity, and real estate. Investing in almost any industry can help build capital for businesses.
Investing puts money to work. On the surface, investing can appear like saving money; however, saving money sits in an account, gaining little per year, as saving accounts have an average of 0.7% growth per year. Investors can choose to actively invest, which means they manage their portfolio or passively invest, which means they take a less involved approach to investing. They can also choose to invest in high-growth companies with higher Price-earnings (P/E) or invest in companies that have lower P/E but have higher dividend yields. Both approaches can pay large sums; it depends on how much risk they want to include in their investment portfolios.
Read more about what investing is and why you should learn it.
What Can You Do with Investing?
When you think of investing, the image that comes to mind is Stock Brokers frantically calling in trades as they watch the numbers scroll by on the screen. Stock Brokers are a large part of the investing world. They deal with the stock market every single day. They help keep the economy moving. However, there is more to investing than just stock brokers.
With the internet, anyone can invest in the market using mobile apps. You can also invest to save for retirement or various other reasons. When starting with investing, you want to start an investment portfolio. Often, these portfolios include bonds, stocks, mutual funds, Exchange Traded Funds (ETFs), real estate, and cash equivalents. However, some people choose to invest their money in more unusual ways. One of the key parts of investing is choosing assets that will increase in value over time. Investments can be physical assets as well. One good way to invest is to buy a vacation or rental property that you can rent out. This option allows the money you used to purchase the property to bring more money back to you. Others invest in other items like cars, handbags, or even watches. Each of these items needs a lot of research to ensure they are worth purchasing and if they will bring in more money if sold later.
Average Time it Takes to Learn Investing
On average, starting with investing will typically take between one and five years to grasp the stock market. During the first year, beginners will learn how the stock market works and ways to make trades to become successful. Several experts agree that in the first six to twelve months, one learns the basics and masters those concepts, after which one learns advanced concepts and invests. Here is a sample breakdown of good investing habits a person will learn through these beginning stages.
- Research. With access to the internet and thousands of resources every minute, it may appear that you will have all the information at your fingertips to make a well-informed trade. However, too much information can lead to analysis paralysis, leading to indecision. When researching stocks, you will learn the essential information you need to make a trade and disregard the rest. However, this will come with practice over time.
- Make fast-paced decisions. We make decisions every moment of every day; however, most of these decisions are inconsequential. Investors will spend time making split-second decisions with little information. These decisions are high risk, and the intense mental effort can wear down beginner investors.
- Growing market knowledge. One must understand how the market works to make informed decisions about the market and trade. Throughout the beginning stages of your learning, you will spend time watching the market and learning the patterns within the market. This can help you understand when to make a trade before spending or losing a lot of money.
Other Factors
Investing experts agree that it takes one to five years to learn to invest. However, this average does not account for the other factors that contribute to how long you can expect the process to take. Please remember that none of these factors mean you should not learn to invest; your learning process might take a bit longer without them than others.
Invest as you Learn
While you should understand several concepts and principles when learning to invest, one way to help speed up the process is to invest as you learn. Investing is a real "practice makes perfect" type of skill.
As you learn new concepts or ideas, you should practice them with your investing. You can start with small amounts, but this way, you are gaining experience and seeing how the market reacts as you learn.
Emotional Control
A large part of investing is maintaining a level head and not putting your emotions into each trade. This can be the hardest part for beginners to learn. However, if you already have practiced emotional control, where you can keep your emotions at bay even in the most stressful situations. In that case, you will have an easier time making decisions and learning how to invest.
Prior Financial Experience
Investing requires a lot of financial knowledge. Starting to learn investing with some financial literacy will help you understand some of the complex financial concepts associated with investing. Understanding finance can help you shorten the time you spend learning the financial aspects of investing, not eliminate it depending on your previous experience.
Learning Method and Speed
One of the most common ways to speed up learning skills is to take a class in the subject. Doing this will give you a structured environment to learn the necessary concepts without finding and learning them on your own. However, it is also important to consider your learning speed. If you pick up on concepts easier, then the learning process may take less time than others. However, if it takes you a while to grasp concepts, you may be looking at a longer learning time.
Level of Difficulty, Prerequisites, & Cost
Investors have to keep track of several moving variables to be successful. Oftentimes they are making split-second decisions without all of the information. Because of this, investing is a challenging skill to learn and master. However, there are many ways to invest, and some are easier than others.
Before investing, beginners should develop some versatile skills that will help them with their learning. Beginners should understand how to set goals and ways to make those goals achievable. It would also be helpful if they spent time watching the market and researching companies they would be interested in investing in. A large part of investing is understanding financial concepts. Taking the time to familiarize yourself with some financial concepts can help you throughout your learning process.
To start investing, you can download one of the free investing apps or open a free brokerage account. From there, you can invest the amount you feel comfortable with. Stocks held for over a year before being sold will be subject to capital gains tax.
Read about how difficult it is to learn to invest.
Watch a Free Investing Online Course
Are you not ready to commit to a full course but still want an overview of investing? You can start learning for free online! Check out Noble Desktop's free Stock Market Investing Fundamentals course. In this course, viewers learn the basics of stock market investing and gain an understanding of different investing strategies. You will learn what moves the stock market and the fundamental principles that control the market.
Other providers also offer free investing classes. Udemy offers several courses that cover the basics of investing, with some courses covering topics like cryptocurrency. You can also find some free classes on Coursera. You even have the option to audit their longer investing courses for free. You can find hundreds of investing videos on YouTube to help you get started with becoming investing and financially literate. You can check out Noble Desktop's YouTube channel for investing videos that cover various topics.
Read about more free investing videos and online tutorials.
Learn Investing with Hands-on Training at Noble Desktop
Noble Desktop provides an array of Investing and Financial classes that meet various scheduling requirements and learning styles. No matter how you enroll in these courses, students will learn from expert instructors in small classes. Students may attend in-person training at Noble's Manhattan campus or remotely from anywhere. In addition to the courses, all students can retake the course within one year of completing it for no extra charge, giving them more time to hone their skills.
For those interested in beginning their investment journey, Noble offers a short introduction course, Stock Market Investing, teaching students the fundamentals of the stock market and how to invest. Students will learn what moves the stock market and how investors value stocks. Students will understand P/E ratios and DCF analysis as they dive into different financial statements. While this course does not provide enough information to start your investing career, it does provide vital information that will help you out in your career and get you on the right path.
Students may consider the Financial Analysts Training Program to jump-start a career in the financial sector or with investing. In the program, students work with financial modeling and valuation. As students learn basic and advanced features of Microsoft Excel, they learn to utilize the program for long-term planning, financial functions, and cash flow projection. Those interested in becoming Financial Analysts may also consider the Python for Finance Bootcamp. This course teaches how to use the Python programming language’s financial libraries to gather and manipulate financial data. Both of these courses can jump-start your career in investing!
Key Insights
- Most individuals learn proper investment skills within one to five years.
- The first year of investing is grasping basic concepts and the stock market.
- There are ways to speed up the learning process, including:
- Invest as you learn
- Emotional Control
- Previous Financial experience
- Learning speed
- You can speed up any learning process by checking out in-person or live online classes with Noble Desktop.
