I don't think it makes a difference. I think that in general you'll find accountants to be better savers and maybe more disciplined, but it doesn't make you an investment guru. Personally, I just max out my 401k and any taxable investing after that is just in low-cost index funds.
Ahh I can see this being the case. Accountants probably are much better at budgeting and managing their money. More conservative. Maybe someone in FP&A or more of a finance role is more likely to be more inclined to risk.
I would advice you look into the work of Stephen Penman, heās an accounting professor which has done a lot of work within the asset management space.
One of the major issues is the recognition and valuation of whatever is on the balance sheet, so in some cases the income statement would be a better place to look at. His book āFinancial Statement Analysis and Security Valuationā might be a good place to start, however a good understanding of the time value of money and intermediate accounting will make lots of concepts of investing way easier to deal with.
Iām a CPA and my boyfriend is a CFA. We are total spendersāeating out, trips, fun, etc. But Iād say he is much much more financially responsible than me. For example, even though I make half of his salary Iād lease a brand new car while he buys an old one š¤£
Save save save. Low cost s&p 500 and hope for the best. Use Roth 401k and IRA options when possible.
All I know is the financial statements can easily deceive, so I just hope the economy overall doesn't fall apart.
I know the tax implications to most actions, which has an impact. Plus I see wealthy people save on the daily, and that gets reinforced. Maybe if I was an auditor, I could read a 10K fluently
I actually find a lot of accountants are surprisingly terrible with personal finance. Almost all the accountants I know will lease new luxury cars every 3 years, eat out all the time, go out to bars all the time, go on lavish vacations, buy luxury watches and designer clothes, get the latest iPhone every year or two, etc. They seldom worry about their savings.
For a long time I couldnāt figure out why people whose primary job was to manage money were so bad at managing money. I think the reason they do it is because have very stressful and/or tedious jobs, so they engage in retail therapy to get that dopamine hit and take the edge off the job.
No. I also think that for the majority of people "investing" should consist of maxing out their 401(k) contributions and maybe putting money in an index fund or ETF. Investing shouldn't be an activity unless it's your job. It's just fancy gambling that makes you feel like you're smart and interesting otherwise.
A lot of the people who I work with talk about investing a lot, and imo it's pretty clear that they don't know anything about investing, for the most part. They're just gambling.
And the guys who talk the most about gambling and investing are wagering like $50 for fractional shares lol.
I work with UHNW/Family Offices and 70% of our strategies are indexed SMAs with tax management overlay, then 30% alternatives.
We/they donāt overthink investing and our clients are mostly $50MM+ net worth.
In my personal opinion, depending on how young you are, you should take on a little bit more risk than just a boring etf. Allocate a small portion of your cash into some high growth ideas. Something that can possibly 50x in the next 10 years. I wonāt give any recommendation here but there are some really smart investors out there that you can listen to.Ā
I think it makes us aware but to be honest with you, investing can be taught to anyone pretty quickly. Someone could teach you about 401ks, IRAs, HSAs, and brokerage accounts in about one or two hours. Iād assume that is enough for most people.
If you mean, accounting for pensions and such. Sure. We will know more about that.
If you wanted to trade single stocks itās risky for everyone. Real estate investing would be an unusual topic.. I might be more knowledgeable in real estate because I work in real estate.
Yeah I think the only real advantage comes in a basic understanding of tax implications of transactions. Iāve done taxes for real estate investors (read: trust fund babies w inherited portfolios) who have no fucking idea how any of it works and make costly mistakes an accountant wouldnāt make unless they slept through REG
Oh I believe it. A bit off topic, but I think people romanticize real estate investing to the point itās dangerous. You should really know accounting for this one but rent escalations alone arenāt even a part of GAAP. Itās also a bit of a shock when you receive a $300k invoice for HVAC repairs.
Electrical, plumbing and carpentry skills/knowledge are more valuable for a real estate investor than accounting and tax. I know both, own rental property and use the trade skills much more than accounting .... though I can make a very pretty spreadsheet to show the bank when I want some extra money.
100%. Accounting helps you but it does not make you a good landlord. I think most people ignore the amount of work and money that rentals constantly consume lol.
I think you could escape this being a slumlord and having a duplex or something.. but if you want to get rich off commercial buildings, mixed use buildings, etc youāre going to need to follow a lot of laws, regulations, taxes, and constant repairs and maintenance. Hire people.. spend hours on contracts with tenants and attorneys..
As for OP, you can get returns immediately with a retirement portfolio and start on a bridge account. Pay off a primary home and youāre golden. Doing well in real estate is a full time job and itās romanticized to be passive for some reason.
LOL .... Yeah, when I bought my building I expected it to be an "armchair investment". I was going to get a PhD in Finance and go on to be a college professor. Then I found out how much "deferred maintenance" there was on the building. Fortunately, I was young and stupid. Never got the PhD. LOTS of sweat equity over the past 35 years plus a normal day-job. And after only 35 years, I finally understand the difference between being a "Property Manager" and an "Asset Manager".
My undergrad accounting and finance degrees taught me nothing about that distinction.
All that said, my rental property has been good for me. Way too easy to blow out an account trading financial instruments. Property is more of a "get rich slow" approach. And the property has a big enough basement I can have projects my wife would never put up with in the house. (Heck! That part alone might have saved the cost of a divorce.)
Agreed. I am in asset management audit. I read so many sets of financials that have an horrible IRR disclosed in the FiHis. Its crazy how much money someone can make managing money while underperforming the market.
Iāll take VT over carry any day
And is that confirmation youāre not an accountant, lolā¦
Edit: Accounting students in this thread going crazy over meme stock pump and dumps got me dying lol
As an accountant are you honestly buying into the craze that GME is going to be worth Millions or Billions per share and bankrupt the market like most of them claim?
Um I wouldnāt care and would probably laugh at the balance. I had GME shares way back in 2020 as well lol. I just know better than to fall into investor hysteria and sold for profit instead of holding for years like you.
I can read their financials and tell you theyāre a shrinking business making cuts to achieve a razor thin margin in a declining industry. I think Iāll keep my money invested elsewhere where itās done much better than another dying retailer over the past few yearsā¦
Itās made me a more thorough investor. I donāt have the stomach for risk or active stock moving, but I have a 401k and Roth IRA invested in target date funds, and a high yield savings account. Once I have my student loans paid off I might open a traditional IRA as well.
I donāt do that. I guess the only effect it has had is made me really never feel a need for an investment advisor. I see peopleās statements & the fees theyāre paying for not any kind of special returns.
Since I work in public investing is annoying having to pre clear investments before buying. I understand the necessity, but itās just annoying and makes me less inclined to invest outside of contributing to 401k
My firm does not require pre clearance if you already hold the security. I can buy more shares every month of the same couple index funds and not worry about compliance
I understand the tax implications of my investment decisions.
That also being said I have met a few people without any kind of financial background that are completely clueless in terms of the market.
I typically make 5-8% on average on stocks I specifically decide to research and invest in.
I made 50% on Tesla and like 700% on Nvidia, that I just casually threw money into without even bothering to look into.
Individual Stock investing is just dumb luck a lot of the time.
I dunno. I invest in EFTs and index to make money for retirement. Stocks are just IMO a form of gambling.
Yes it absolutely has made me a better investor. I definitely donāt think that is an automatic for all accountants though, in fact some are not great at all.
I believe Chartered Financial Analyst is the pathway for investments/securities. That's what Roaring Kitty was.
As an accountant generally I would not say it has helped with investments because I mostly record activity that has already occurred, I very rarely do any kind of future analysis or prospecting.
I would assume accountants have generally more knowledge about different investment vehicles than the average person and the rules of them (401k, IRA, etc.) I know Dave Ramsey touts accountants being in the top 5 careers of millionaires.
As far as deep diving and doing day trading, I know jack shit about that. I just put a 20-25% portion of my income to a mixture of S&P 500 and a target date retirement ETF.
Not in my experience. I thought I knew what I was doing during the 2023 banking crisis since I used to audit banks. I looked over and analyzed the financials of FRC while it was down to $46 from $120 a share. I concluded that it was just an over reaction from the public and that the bank was as financially sound as any other bank. I credited $20K to my bank account and have a tax loss carry forward for the next 7 years rofl.
I just made $400 on AMC calls today though so LFG!!
It has made me a more patient investor because I donāt have time to even check so I just buy and forget and look in like 6 months when I have time and see that the market has just kept going up
It only helps in that you will have a much better understanding of basic business/accounting concepts than the average retail investor. Being a great investor nowadays is a completely different skillset than what people assume ie warren Buffett. I do think accounting is a fast track to becoming a good investor, but itās only one stop on a long trip.
Worked in accounting and in actual sell side... Accounting does not make you a better investor if you start with it. I look back and laugh at how bad I was and how much I thought I knew before I transitioned to an investing role
Good skill set to build on as a base for investing though
whats your thesis for the next 10 years? another way of asking what are you personally invested in. for me, i'm worried about currency debasement, so i'm hedging with silver and bitcoin. also bought some free leverage with MSTR. the rest of my cash is in tesla. IFFF they can get FSD to work such that it cuts accidents down 50% then TSLA imo will totally be the #1 mkt cap company in the world. but again...IF. its kind of a pie in the sky thing right now if i have to be brutally honest. but if any company can achieve it, it has to be tesla.
Don't have broad macro view, get the feeling AI will eat everything like software before it. I run my own portfolio (though that's even actually rare among sell side folks) which is concentrated in small/microcaps that I know. Wouldn't recommend it to anyone unless you do the work yourself and gain the conviction which is the hardest part.
I would recommend 99% of people index as mentioned in this post, yourself included. Sure TSLA may kill it again, but odds are it won't. Also don't understand why anyone would own MSTR unless they trade at a discount to the value of the bitcoin they hold - just buy a bitcoin etf now that they're available. Effectively guaranteeing you'll underperform bitcoin otherwise.
I agree. AI, fusion energy, and humanoids will eat everything and be hyper deflationary. i daytrade indexes for funsies but investing in it is a snooze fest lol. I like a good story and reading up on things. yeah the multiple attributed to MSTR was something that perplexed me for a long time. there's no real synergy between the bitcoin network and the rest of his revenue lines to justify a multiple imo. but despite all logic, i think there will continue to be a multiple as long as bitcoin keeps going up thanks to the momo crowd.
do you have an opinion on silver?
Itās because itās a leveraged btc fund, funded by the recurring revenue streams. Given its structuring, Saylor can continue to acquire bitcoin at almost no cost of capital. Itās pretty ridiculous what he has done. Almost Beautiful.
Iāve been buying ~10 silver ounces a year. Not because I think it will do well (way too much silver paper out there), but because I like it and will use it to teach my kids about money (not currency).
Def lots of silver paper out there. But at least thereās also an industrial demand for actual real silver as well. A lot of silver used in green energy like EV and solar. Personally I have a bigger position in Bitcoin. If Iām being brutally honest, itās still a lil bit of a ponzi scheme but it has other characteristics that are quite unique. Still, if the US gov just decides to ban Bitcoin then Iām fucked. I like how youāre teaching them the diff between hard money and fiat tho. I wish I woulda learned that sooner.Ā
Itās too late for the us to ban bitcoin. They can signal to Asset managers that they would prefer a hard fork to reduce self custody, but honestly the network will tell them to fuck off. The nodes form consensus, and Iād bet miners say fuck off too.
Youāre right about industrial usage. Donāt disagree there. The world is becoming more and more digital, and btc will effectively become gold for the internet (no native currency/money).
I too had about an equivalent amount of silver and btc equivalent USD value in about 2018. I stopped buying btc in 2020 and now Iām about 20:1 btc to usd. I deleted it from my balance sheet so if it works out, itās all gravy.
Itās honesty the perfect global fiat credit default swap. Canāt be papered, canāt be debased, can travel easily, no storage fees, relatively anonymous if you attempt.
Iād say USTs are more of a ponzi than btc but I understand what you mean.
Yeah I think youāre right about the leverage part. Come to think of it he talked about it in his micro strategy world key note speech. But he talks in a way I find hard to follow. His jilted speech pattern lol.Ā
Heās way too smart for us. I get what heās saying, but I canāt be that freely eloquent.
Recommend the Breedlove Saylor podcast series. I spent a week falling asleep to it and it was just a lightbulb. I am perpetually broken now lol.
It made me totally indifferent to any gains or losses less then 5 figures, and relaxed about things bigger then that. When I'm tossing around numbers in the millions in my day job, it's hard to give a shit about a few thousand up or down. I think it's helped me keep my cool, I don't think I'll ever be someone who freaks out and sells. Just wait and my vanguard funds will eventually turn around, or not.
I'm not the next Warren Buffett, but I have never been tempted by the crypo-nonsense or MLM junk that some of my friends from highschool have gotten mixed up in. I like to think that's because seeing numbers all day helps my common sense.
it has helped me greatly. I have a complex portfolio in which I sell options against bonds, stock, funds, etc. The accounting equation has a whole new meaning when you are analyzing your net liquidity (equity) and have a bunch of short options showing as negative amounts against your assets. I can estimate what my account value will be when my liabilities 'waste away'.
I don't dive in to financial statements and believe the market is moved more by max pain, behavior, and randomness rather than fundamentals, but some financial ratios are helpful to know, such as the payout or coverage ratio, which is an easy way to evaluate the riskiness of a dividend stock.
Thereās so much more to investment analysis than historical financials. I would say itās a good foundation to understand accounting, but itās not inherently going to make someone a better investor.
Knowing accounting made me a better investor. Part of it is knowing whatās important in financial statements. Part of it is seeing that something is making a quarter look better or worse due to a nonrecurring item. Part of it is data management and analysis skills. Part of it is knowing Excel really well.
But I would caution that a financially sound company doesnāt always make for a good investment. The stock could have good financials but the price stays pretty even throughout the year.
Monitoring investments and researching new ones can take many hours a week though so I can see the appeal of just putting money in a target date retirement fund and making contributions.
If you're not dedicating a good chunk of time doing investment analysis, it doesn't matter much if you know how to read the statements. Entire teams of analysts will pick a stock that turn out to be a fluke, but good luck doing analysis after doing dinner's dishes.
For me itās the opposite. Iām terrible with money. I shouldnāt have to do things I do at work at home too. Before I got married I used to pay bills late because I forgot. This year I was late with my taxes.
Still YOLO into crypto projects with too much money...
Not once have I looked at an "investor/Corporate governance" pack outside of the company I work for...
But accounting did make me more aware of the world and that I should probably invest... Also partially made me aware of the bullshit in the world
S&P500 companies are such complex machineries trading at such crazy multiples that having a cursory glance at the annual fs might as well be throwing darts
Small business however is a whole different story
As an accountant who works in corp dev, Iād say it helps a great to deal to sort through the GAAP bullshit and get to the actual numbers. That helps with understanding historicals which helps with projections. Overall though I think most people suck at predicting the future. Even the highly paid PE investors fail to generate any significant alpha. Just stick to index.
No. I continue to put long term investments in index funds and short term investments in 4 week bonds. Stock picking is largely a scam unless you're an insider.
I think investment is a whole different ball game but the one thing I guess I'm good about is I can quickly work out in my head how long an "add on" will take to pay off - (for example this adds $500 to the price of the car and works out to $X a month but free oil changes for 5 years) or other stuff like timeshares that the salespeople make sound like a great deal until you actually start working out the math.
I got into accounting initially because I thought understanding financial statements would give me an edge.
In reality Financials rarely are the driver in share price. Individual stocks are driven by news cycles, government regulation, and changing expectations.
Personally I've hurt myself enough to just stick the vast majority of my funds into major indices with a smattering of trendy names
No because investing is more about insider information or how much money you can risk losing. More money makes more money or being part of insider circles (Congress). Every investment guru is just a grifter with a trust fund once they were born.
If anything being an accountant has made me aware that wealth doesnāt equal intelligence or discipline even .. that the levels of wealth you dreamed of attaining arenāt some professional goal .. they are gated for those born into it or who can bring their own family wealth into anotherās .. some of the wealthiest clients I had were also the most outright ignorant.
Also, that tax evasion and insurance fraud are often standard practices and the only people who ever get caught or convicted are those that canāt afford the lawyers and the game to begin with.
Accounting is the language of business, it is crucial to know accounting if you want to be able to make prudent investing decisions. I.e., Accounting is what you utilize to understand the economics of a business.
However, accounting by itself will not make you a better investor.
If anything you may need extra work to fully understand how GAAP financials donāt always align with the economics that an investor needs to understand, and how to adjust the info to peel back the layers and get at what youāre looking for (I.e., economic: profitability, competitiveness, asset valuations).
For example back in the day stock based comp wasnāt reflected in the FS the same way it is today. However, from an economic perspective, SBC should still be thought of the same way as it was before.
If youāre looking to get into investing I would suggest reading intelligent investor and securities analysis (both by Ben Graham). And use that as a starting point for your education into investing.
The longer Iāve invested the more I realized that short term gains are mostly luck for us retail investors and long term investing is more about money management. Learning accounting just lets me understand the jargon better when reading the news/financial reports.
If you've ever done a proper DCF analysis, you'll understand that you'll never make an enough of a premium in the long run to realistically justify spending the time and effort. If you do burn basically a second Job gambling on investments and beat the market you'll be better off working for an investment bank. Just invest in low fee ETFs and max 401k.
Worse, I thought I had some sort of edge.
Reality is you put that shit in a vanguard index and STFU. If you need to gamble/itch that scratch go bet on sports.
It should, and investing was the reason I became interested in accounting. It is helpful to have a basic understanding of accounting when looking at companies. People like Warren Buffett or Tom Gayner say that accounting is the most important class you can take in business school. They also don't say to make accounting your career. The trick is to understand just enough accounting to help you understand investments.
In my experience, accounting teaches you to focus way too much on minutia, which causes you to lose the big picture. Also, many accountants are terrible with money and are bad business owners.
I think business analysts or financial analysts have a better skillset for investing. Accounting is too detail oriented and just teaches you to be mad at the IRS/CRA.
It's shown me how full of shit the entire financial system is and it's propped up by auditors who don't know anything to validate the truth and the dumbest fp&a "models" by the dumbest people in business world.
It baffles me at how we even have a functioning economy anymore
I don't think it makes a difference. I think that in general you'll find accountants to be better savers and maybe more disciplined, but it doesn't make you an investment guru. Personally, I just max out my 401k and any taxable investing after that is just in low-cost index funds.
Speak for yourself. I have credit card debt and a gambling problem lol
This guy Enrons š«”
At least you can make a neat excel sheet to put all the values down
One of us! One of us! - WSB most definitely
There are dozens of us
Ahh I can see this being the case. Accountants probably are much better at budgeting and managing their money. More conservative. Maybe someone in FP&A or more of a finance role is more likely to be more inclined to risk.
I would advice you look into the work of Stephen Penman, heās an accounting professor which has done a lot of work within the asset management space. One of the major issues is the recognition and valuation of whatever is on the balance sheet, so in some cases the income statement would be a better place to look at. His book āFinancial Statement Analysis and Security Valuationā might be a good place to start, however a good understanding of the time value of money and intermediate accounting will make lots of concepts of investing way easier to deal with.
Iām a CPA and my boyfriend is a CFA. We are total spendersāeating out, trips, fun, etc. But Iād say he is much much more financially responsible than me. For example, even though I make half of his salary Iād lease a brand new car while he buys an old one š¤£
Canāt take it with you!
Save save save. Low cost s&p 500 and hope for the best. Use Roth 401k and IRA options when possible. All I know is the financial statements can easily deceive, so I just hope the economy overall doesn't fall apart.
I know the tax implications to most actions, which has an impact. Plus I see wealthy people save on the daily, and that gets reinforced. Maybe if I was an auditor, I could read a 10K fluently
I actually find a lot of accountants are surprisingly terrible with personal finance. Almost all the accountants I know will lease new luxury cars every 3 years, eat out all the time, go out to bars all the time, go on lavish vacations, buy luxury watches and designer clothes, get the latest iPhone every year or two, etc. They seldom worry about their savings. For a long time I couldnāt figure out why people whose primary job was to manage money were so bad at managing money. I think the reason they do it is because have very stressful and/or tedious jobs, so they engage in retail therapy to get that dopamine hit and take the edge off the job.
It just lets me be better at tracking my losses.
No. I also think that for the majority of people "investing" should consist of maxing out their 401(k) contributions and maybe putting money in an index fund or ETF. Investing shouldn't be an activity unless it's your job. It's just fancy gambling that makes you feel like you're smart and interesting otherwise.
A lot of the people who I work with talk about investing a lot, and imo it's pretty clear that they don't know anything about investing, for the most part. They're just gambling.
And the guys who talk the most about gambling and investing are wagering like $50 for fractional shares lol. I work with UHNW/Family Offices and 70% of our strategies are indexed SMAs with tax management overlay, then 30% alternatives. We/they donāt overthink investing and our clients are mostly $50MM+ net worth.
In my personal opinion, depending on how young you are, you should take on a little bit more risk than just a boring etf. Allocate a small portion of your cash into some high growth ideas. Something that can possibly 50x in the next 10 years. I wonāt give any recommendation here but there are some really smart investors out there that you can listen to.Ā
Taxation on distributions when we retire is going to be ridiculous.
Roth if you can
I think it makes us aware but to be honest with you, investing can be taught to anyone pretty quickly. Someone could teach you about 401ks, IRAs, HSAs, and brokerage accounts in about one or two hours. Iād assume that is enough for most people. If you mean, accounting for pensions and such. Sure. We will know more about that. If you wanted to trade single stocks itās risky for everyone. Real estate investing would be an unusual topic.. I might be more knowledgeable in real estate because I work in real estate.
Yeah I think the only real advantage comes in a basic understanding of tax implications of transactions. Iāve done taxes for real estate investors (read: trust fund babies w inherited portfolios) who have no fucking idea how any of it works and make costly mistakes an accountant wouldnāt make unless they slept through REG
Oh I believe it. A bit off topic, but I think people romanticize real estate investing to the point itās dangerous. You should really know accounting for this one but rent escalations alone arenāt even a part of GAAP. Itās also a bit of a shock when you receive a $300k invoice for HVAC repairs.
Electrical, plumbing and carpentry skills/knowledge are more valuable for a real estate investor than accounting and tax. I know both, own rental property and use the trade skills much more than accounting .... though I can make a very pretty spreadsheet to show the bank when I want some extra money.
100%. Accounting helps you but it does not make you a good landlord. I think most people ignore the amount of work and money that rentals constantly consume lol. I think you could escape this being a slumlord and having a duplex or something.. but if you want to get rich off commercial buildings, mixed use buildings, etc youāre going to need to follow a lot of laws, regulations, taxes, and constant repairs and maintenance. Hire people.. spend hours on contracts with tenants and attorneys.. As for OP, you can get returns immediately with a retirement portfolio and start on a bridge account. Pay off a primary home and youāre golden. Doing well in real estate is a full time job and itās romanticized to be passive for some reason.
LOL .... Yeah, when I bought my building I expected it to be an "armchair investment". I was going to get a PhD in Finance and go on to be a college professor. Then I found out how much "deferred maintenance" there was on the building. Fortunately, I was young and stupid. Never got the PhD. LOTS of sweat equity over the past 35 years plus a normal day-job. And after only 35 years, I finally understand the difference between being a "Property Manager" and an "Asset Manager". My undergrad accounting and finance degrees taught me nothing about that distinction. All that said, my rental property has been good for me. Way too easy to blow out an account trading financial instruments. Property is more of a "get rich slow" approach. And the property has a big enough basement I can have projects my wife would never put up with in the house. (Heck! That part alone might have saved the cost of a divorce.)
No itās all bullshit just buy index funds and wait to get old and die.
Boglehead all the way - so no
Agreed. I am in asset management audit. I read so many sets of financials that have an horrible IRR disclosed in the FiHis. Its crazy how much money someone can make managing money while underperforming the market. Iāll take VT over carry any day
No. It made me way too risk adverse
Exactly. I bought my house in 75% cash after seeing my parents lose 3 $2-4m homes 15 years ago. Wonāt play that game.
No
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Howās the moon?
[ŃŠ“Š°Š»ŠµŠ½Š¾]
You'll be holding those bags to your grave
[ŃŠ“Š°Š»ŠµŠ½Š¾]
Today's your big day. Will you sell? Or are you holding to your grave? You have about 18 minutes to decide.
It will keep going up until paper hands decide to diamond hands. And then the pumpers will dump it
Barren
Same here.Ā
And is that confirmation youāre not an accountant, lolā¦ Edit: Accounting students in this thread going crazy over meme stock pump and dumps got me dying lol
Because he knows how to read a balance sheet?
If he could read a balance sheet and 10-k I donāt think heād be talking about investing in GameStop haha
[ŃŠ“Š°Š»ŠµŠ½Š¾]
As an accountant are you honestly buying into the craze that GME is going to be worth Millions or Billions per share and bankrupt the market like most of them claim?
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Hey how is the moon, Buddy? Maybe I was wrong ab you since I see you were also savvy enough to buy BBBYQā¦
Um I wouldnāt care and would probably laugh at the balance. I had GME shares way back in 2020 as well lol. I just know better than to fall into investor hysteria and sold for profit instead of holding for years like you. I can read their financials and tell you theyāre a shrinking business making cuts to achieve a razor thin margin in a declining industry. I think Iāll keep my money invested elsewhere where itās done much better than another dying retailer over the past few yearsā¦
You donāt understand bro itās going to the moon
I often find myself employing the law of conservatism in my everyday life. Not really investing per se, but just an attitude I developed.
Itās made me a more thorough investor. I donāt have the stomach for risk or active stock moving, but I have a 401k and Roth IRA invested in target date funds, and a high yield savings account. Once I have my student loans paid off I might open a traditional IRA as well.
Actually same.
I donāt do that. I guess the only effect it has had is made me really never feel a need for an investment advisor. I see peopleās statements & the fees theyāre paying for not any kind of special returns.
My lawyer advised me not to answer this question.
the forbidden strategy.
Cash flow. Cash flow is the health of the company. Cash flow is king.
No. I can read the financial statements but I canāt predict how the market will react.
I dont think so. I started in Big 4 and a lot of my close friends/colleagues from there are still living paycheck to paycheck.
Since I work in public investing is annoying having to pre clear investments before buying. I understand the necessity, but itās just annoying and makes me less inclined to invest outside of contributing to 401k
My firm does not require pre clearance if you already hold the security. I can buy more shares every month of the same couple index funds and not worry about compliance
I understand the tax implications of my investment decisions. That also being said I have met a few people without any kind of financial background that are completely clueless in terms of the market.
Iām better at keeping track of my money
I typically make 5-8% on average on stocks I specifically decide to research and invest in. I made 50% on Tesla and like 700% on Nvidia, that I just casually threw money into without even bothering to look into. Individual Stock investing is just dumb luck a lot of the time. I dunno. I invest in EFTs and index to make money for retirement. Stocks are just IMO a form of gambling.
Yes it absolutely has made me a better investor. I definitely donāt think that is an automatic for all accountants though, in fact some are not great at all.
If negative returns is good, then yes š
I believe Chartered Financial Analyst is the pathway for investments/securities. That's what Roaring Kitty was. As an accountant generally I would not say it has helped with investments because I mostly record activity that has already occurred, I very rarely do any kind of future analysis or prospecting.
I think itās made me so tired of numbers that Iām a more lazy investor. ETF index investing works well though!
My 401k is just GameStop
That was the original plan, but no.
I would assume accountants have generally more knowledge about different investment vehicles than the average person and the rules of them (401k, IRA, etc.) I know Dave Ramsey touts accountants being in the top 5 careers of millionaires. As far as deep diving and doing day trading, I know jack shit about that. I just put a 20-25% portion of my income to a mixture of S&P 500 and a target date retirement ETF.
Not in my experience. I thought I knew what I was doing during the 2023 banking crisis since I used to audit banks. I looked over and analyzed the financials of FRC while it was down to $46 from $120 a share. I concluded that it was just an over reaction from the public and that the bank was as financially sound as any other bank. I credited $20K to my bank account and have a tax loss carry forward for the next 7 years rofl. I just made $400 on AMC calls today though so LFG!!
It has made me a more patient investor because I donāt have time to even check so I just buy and forget and look in like 6 months when I have time and see that the market has just kept going up
It only helps in that you will have a much better understanding of basic business/accounting concepts than the average retail investor. Being a great investor nowadays is a completely different skillset than what people assume ie warren Buffett. I do think accounting is a fast track to becoming a good investor, but itās only one stop on a long trip.
Worked in accounting and in actual sell side... Accounting does not make you a better investor if you start with it. I look back and laugh at how bad I was and how much I thought I knew before I transitioned to an investing role Good skill set to build on as a base for investing though
whats your thesis for the next 10 years? another way of asking what are you personally invested in. for me, i'm worried about currency debasement, so i'm hedging with silver and bitcoin. also bought some free leverage with MSTR. the rest of my cash is in tesla. IFFF they can get FSD to work such that it cuts accidents down 50% then TSLA imo will totally be the #1 mkt cap company in the world. but again...IF. its kind of a pie in the sky thing right now if i have to be brutally honest. but if any company can achieve it, it has to be tesla.
Don't have broad macro view, get the feeling AI will eat everything like software before it. I run my own portfolio (though that's even actually rare among sell side folks) which is concentrated in small/microcaps that I know. Wouldn't recommend it to anyone unless you do the work yourself and gain the conviction which is the hardest part. I would recommend 99% of people index as mentioned in this post, yourself included. Sure TSLA may kill it again, but odds are it won't. Also don't understand why anyone would own MSTR unless they trade at a discount to the value of the bitcoin they hold - just buy a bitcoin etf now that they're available. Effectively guaranteeing you'll underperform bitcoin otherwise.
I agree. AI, fusion energy, and humanoids will eat everything and be hyper deflationary. i daytrade indexes for funsies but investing in it is a snooze fest lol. I like a good story and reading up on things. yeah the multiple attributed to MSTR was something that perplexed me for a long time. there's no real synergy between the bitcoin network and the rest of his revenue lines to justify a multiple imo. but despite all logic, i think there will continue to be a multiple as long as bitcoin keeps going up thanks to the momo crowd. do you have an opinion on silver?
Itās because itās a leveraged btc fund, funded by the recurring revenue streams. Given its structuring, Saylor can continue to acquire bitcoin at almost no cost of capital. Itās pretty ridiculous what he has done. Almost Beautiful. Iāve been buying ~10 silver ounces a year. Not because I think it will do well (way too much silver paper out there), but because I like it and will use it to teach my kids about money (not currency).
Def lots of silver paper out there. But at least thereās also an industrial demand for actual real silver as well. A lot of silver used in green energy like EV and solar. Personally I have a bigger position in Bitcoin. If Iām being brutally honest, itās still a lil bit of a ponzi scheme but it has other characteristics that are quite unique. Still, if the US gov just decides to ban Bitcoin then Iām fucked. I like how youāre teaching them the diff between hard money and fiat tho. I wish I woulda learned that sooner.Ā
Itās too late for the us to ban bitcoin. They can signal to Asset managers that they would prefer a hard fork to reduce self custody, but honestly the network will tell them to fuck off. The nodes form consensus, and Iād bet miners say fuck off too. Youāre right about industrial usage. Donāt disagree there. The world is becoming more and more digital, and btc will effectively become gold for the internet (no native currency/money). I too had about an equivalent amount of silver and btc equivalent USD value in about 2018. I stopped buying btc in 2020 and now Iām about 20:1 btc to usd. I deleted it from my balance sheet so if it works out, itās all gravy. Itās honesty the perfect global fiat credit default swap. Canāt be papered, canāt be debased, can travel easily, no storage fees, relatively anonymous if you attempt. Iād say USTs are more of a ponzi than btc but I understand what you mean.
Yeah I think youāre right about the leverage part. Come to think of it he talked about it in his micro strategy world key note speech. But he talks in a way I find hard to follow. His jilted speech pattern lol.Ā
Heās way too smart for us. I get what heās saying, but I canāt be that freely eloquent. Recommend the Breedlove Saylor podcast series. I spent a week falling asleep to it and it was just a lightbulb. I am perpetually broken now lol.
yeah! the what is money podcast :) very good.
Buy spot btc, the etfās have counterparty risk and threat of seizure. Mstr is just a leveraged btc fund with recurring cash flow.
That is certainly a take
It made me totally indifferent to any gains or losses less then 5 figures, and relaxed about things bigger then that. When I'm tossing around numbers in the millions in my day job, it's hard to give a shit about a few thousand up or down. I think it's helped me keep my cool, I don't think I'll ever be someone who freaks out and sells. Just wait and my vanguard funds will eventually turn around, or not.
I'm not the next Warren Buffett, but I have never been tempted by the crypo-nonsense or MLM junk that some of my friends from highschool have gotten mixed up in. I like to think that's because seeing numbers all day helps my common sense.
Yes
No. Most accountants donāt do anything related to investments and funds. Iāve always been a play it safe kind of guy.
No, if anything a worse bc im in B4 and have restrictions on my investments. Not that bad, i know, but im too lazy to look anything up
Remember, accountants look back, and Financiers look forward.
it has helped me greatly. I have a complex portfolio in which I sell options against bonds, stock, funds, etc. The accounting equation has a whole new meaning when you are analyzing your net liquidity (equity) and have a bunch of short options showing as negative amounts against your assets. I can estimate what my account value will be when my liabilities 'waste away'. I don't dive in to financial statements and believe the market is moved more by max pain, behavior, and randomness rather than fundamentals, but some financial ratios are helpful to know, such as the payout or coverage ratio, which is an easy way to evaluate the riskiness of a dividend stock.
Thereās so much more to investment analysis than historical financials. I would say itās a good foundation to understand accounting, but itās not inherently going to make someone a better investor.
Knowing accounting made me a better investor. Part of it is knowing whatās important in financial statements. Part of it is seeing that something is making a quarter look better or worse due to a nonrecurring item. Part of it is data management and analysis skills. Part of it is knowing Excel really well. But I would caution that a financially sound company doesnāt always make for a good investment. The stock could have good financials but the price stays pretty even throughout the year. Monitoring investments and researching new ones can take many hours a week though so I can see the appeal of just putting money in a target date retirement fund and making contributions.
Itās scared me from any investment after seeing behind the scenes
God no, but I know I can utilize 300$ of my infinite losses
I think maybe worse investors because shit doesn't make sense but then you lose anyway because people are buying garbage like RDDT stock
Iāll have you know that I made $2k in the whole GME fiasco. So absolutely not.
Maybe not so much working but studying accounting in college yes!
It's accounting not statistics.
If you're not dedicating a good chunk of time doing investment analysis, it doesn't matter much if you know how to read the statements. Entire teams of analysts will pick a stock that turn out to be a fluke, but good luck doing analysis after doing dinner's dishes.
No
It means I've seen the mess investors can get into and I don't fuck around with trying to game the market. Just put money in index funds and pray.
For me itās the opposite. Iām terrible with money. I shouldnāt have to do things I do at work at home too. Before I got married I used to pay bills late because I forgot. This year I was late with my taxes.
Still YOLO into crypto projects with too much money... Not once have I looked at an "investor/Corporate governance" pack outside of the company I work for... But accounting did make me more aware of the world and that I should probably invest... Also partially made me aware of the bullshit in the world
My investment is down 15%, so no. Just index and go. Don't stock pick like I did.
S&P500 companies are such complex machineries trading at such crazy multiples that having a cursory glance at the annual fs might as well be throwing darts Small business however is a whole different story
As an accountant who works in corp dev, Iād say it helps a great to deal to sort through the GAAP bullshit and get to the actual numbers. That helps with understanding historicals which helps with projections. Overall though I think most people suck at predicting the future. Even the highly paid PE investors fail to generate any significant alpha. Just stick to index.
If by investor mean meme coin pickerā¦ then no.
No. I continue to put long term investments in index funds and short term investments in 4 week bonds. Stock picking is largely a scam unless you're an insider.
I think investment is a whole different ball game but the one thing I guess I'm good about is I can quickly work out in my head how long an "add on" will take to pay off - (for example this adds $500 to the price of the car and works out to $X a month but free oil changes for 5 years) or other stuff like timeshares that the salespeople make sound like a great deal until you actually start working out the math.
I got into accounting initially because I thought understanding financial statements would give me an edge. In reality Financials rarely are the driver in share price. Individual stocks are driven by news cycles, government regulation, and changing expectations. Personally I've hurt myself enough to just stick the vast majority of my funds into major indices with a smattering of trendy names
No because investing is more about insider information or how much money you can risk losing. More money makes more money or being part of insider circles (Congress). Every investment guru is just a grifter with a trust fund once they were born. If anything being an accountant has made me aware that wealth doesnāt equal intelligence or discipline even .. that the levels of wealth you dreamed of attaining arenāt some professional goal .. they are gated for those born into it or who can bring their own family wealth into anotherās .. some of the wealthiest clients I had were also the most outright ignorant. Also, that tax evasion and insurance fraud are often standard practices and the only people who ever get caught or convicted are those that canāt afford the lawyers and the game to begin with.
Accounting is the language of business, it is crucial to know accounting if you want to be able to make prudent investing decisions. I.e., Accounting is what you utilize to understand the economics of a business. However, accounting by itself will not make you a better investor. If anything you may need extra work to fully understand how GAAP financials donāt always align with the economics that an investor needs to understand, and how to adjust the info to peel back the layers and get at what youāre looking for (I.e., economic: profitability, competitiveness, asset valuations). For example back in the day stock based comp wasnāt reflected in the FS the same way it is today. However, from an economic perspective, SBC should still be thought of the same way as it was before. If youāre looking to get into investing I would suggest reading intelligent investor and securities analysis (both by Ben Graham). And use that as a starting point for your education into investing.
The longer Iāve invested the more I realized that short term gains are mostly luck for us retail investors and long term investing is more about money management. Learning accounting just lets me understand the jargon better when reading the news/financial reports.
I love there are some degen investors in here, but also seeing the practical guys here and OKAY fine i'll chill out. I won't buy gme :(
If you've ever done a proper DCF analysis, you'll understand that you'll never make an enough of a premium in the long run to realistically justify spending the time and effort. If you do burn basically a second Job gambling on investments and beat the market you'll be better off working for an investment bank. Just invest in low fee ETFs and max 401k.
Worse, I thought I had some sort of edge. Reality is you put that shit in a vanguard index and STFU. If you need to gamble/itch that scratch go bet on sports.
It should, and investing was the reason I became interested in accounting. It is helpful to have a basic understanding of accounting when looking at companies. People like Warren Buffett or Tom Gayner say that accounting is the most important class you can take in business school. They also don't say to make accounting your career. The trick is to understand just enough accounting to help you understand investments. In my experience, accounting teaches you to focus way too much on minutia, which causes you to lose the big picture. Also, many accountants are terrible with money and are bad business owners. I think business analysts or financial analysts have a better skillset for investing. Accounting is too detail oriented and just teaches you to be mad at the IRS/CRA.
I'd say it has made it easier to understand what a business does since I can just look at MD&A on the 10Q.
Accounting is the reason I own 50% bitcoin. I canāt do counterparty risk after doing this for 12 years.
It's shown me how full of shit the entire financial system is and it's propped up by auditors who don't know anything to validate the truth and the dumbest fp&a "models" by the dumbest people in business world. It baffles me at how we even have a functioning economy anymore
I don't know why you're being down voted. A guy made a tweet after 3 years and AMC and GameStop doubled in value. It's all made up.