Cash Course with Atul: Finance in Hollywood - What to embrace and what to ignore

A BRIEF SUMMARY:

• Films about finance likeThe Wolf of Wall Street and Wall Street captivate audiences with stories of wealth, power, and excess.

• These movies often blur the line between fact and fiction, glamorising the extremes while glossing over the consequences.

• Real-world finance is less about yachts and more about spreadsheet

• By separating entertainment from reality, we can highlight some lessons about what creates long-term success in this domain.

It’s not all about the yachts

Many finance movies paint a false picture of finance as a playground for the ultra wealthy. Yachts, mansions, and parties take centre stage and create a tantalising image of success. The reality is far less glamorous. Most professionals in finance spend their time in spreadsheets, reading filings, and doing mundane tasks

Most of the exciting opportunities captured in the film come after years of diligent work, not overnight success. Consistency and discipline are more common than champagne and helicopters. Believing the hype can mislead aspiring investors into chasing flashy and high-risk ventures instead of building a solid foundation for the long term.

The extremes are dangerous

Hollywood thrives on extremes, and finance films are no exception. Movies like The Wolf of Wall Street and Wall Street revel in excess and ruthless pursuits of power. These depictions make for thrilling storytelling and gloss over the destructive consequences of such behaviour. Real-life extremes – whether taking on excessive leverage, chasing risky investments, or prioritising profits above all else – can lead to financial ruin. There are many examples in history where this has proved true.

For individual investors, the lesson is that balance is key. Sensational gains often come with equally sensational risks. You hear a lot about those that swing for the fences and make it huge. Remember that for every one of these winners, there are many who lost a lot you will never hear about.

The long-term really matters

Films like to focus on aggressive short-term plays; in reality, wealth is rarely built overnight. Warren Buffet built his extraordinary wealth over decades and harnessed the power of time to compound.

Keeping an eye on the long-term means foregoing the chasing of immediate rewards that can lead to reckless decisions. Having this mindset can help you hold on during periods of turbulence or steadily contribute to your retirement accounts.

Ethics really matter

The mantra from Wall Street of “greed is good” is not a sustainable philosophy. Films dramatize the “ends justify the means” approach, where bending the rules leads to momentary triumph. Unfortunately, this does happen in real life as well. The consequences are often ugly and result in scandals, lawsuits, or worse.

Trust is a currency in finance, and once it is lost,it is nearly impossible to regain. The downfall of figures like Bernie Madoff serves as a reminder that unethical behaviour carries heavy consequences. Doing the right thing might not feel sexy, but it lays a rock-solid foundation that cannot be bought.