Stock Market Movies
What do we think of when we hear the word ‘finance’? Do we think of the complex mathematical equations and charts or does it surface men dressed in dapper suits with leather briefcases making shady backroom deals? One might associate the lavish lifestyle filled with all the comfort the world has to offer with the word ‘finance’. The financial world indeed makes for great cinema. Misfortune, comedy, creativity, disasters, and redemption are general themes present in the many finance movies that various film industries have produced over the years.
A lot of these movies revolving
around the world of finance portray the finance industry in a bad light and
alter the public opinion of the world of finance. However, it may also attract
young aspirants to finance.
Movies are a great way to
learn about these otherwise dry topics and instruments. They effortlessly
explain about these sometimes-boring subjects and while doing so are both
entertaining and educative. Instead of grabbing a book and trying to infer what
they mean, budding professionals or even the general masses looking to gain a
little knowledge can watch these informative movies with enthralling narratives
and great acting to gain a little insight on the world of finance.
Following are some of the
many must-watch movies professionals can watch.
I. THE BIG SHORT (2015)
The Big Short is an Oscar-winning movie based on a
book of the same name. It was directed by Adam McKay and has an excellent
casting including Christian Bale, Steve Carell, Ryan Gosling, and Brad Pitt. The
film comprises of three separate however simultaneous stories, approximately
associated by their actions in the years paving the way to the 2007 housing
crisis. It not only focuses on the events that led to the housing bubble, but
it also revolves around the conflicted morality of several men who foresaw the
crisis well in advance.
The story primarily revolves around the work of eccentric hedge
fund manager, Michael Burry portrayed by Christian Bale. He
recognises that the U.S. housing market of the mid-2000s is basically an asset
bubble swelled by high-risk loans. Anticipating the market's collapse, in 2005,
Michael – the manager of Scion Capital - proposes to create a credit
default swap market, allowing him to bet against the market. Upon this
decision of his, his clients as well as the banks, grow angry arguing that the
market is stable. His long-term bet, surpassing $1 billion, is acknowledged by
significant investment and commercial banks yet require paying considerable monthly
premiums. One of his clients, Lawrence Fields, proceeds to, to accuse him of ‘wasting’ capital and
many others demand that he reverse and sell, but Michael refuses. Eventually,
he restricts withdrawal placing a
moratorium on
withdrawal and this decision further angers investors.
At the same time, Jared Vennett (played by Ryan
Gosling) incidentally finds Burry's objective to set up the credit default swap.
Another Hedge fund manager, Mark Baun (played by Steve Carrell) joins Burry in investing
into the credit default swap market and recognises that poorly structured loan
packages known as collateralized debt obligations (CDOs) have received AAA
ratings and are worsening the mortgage crisis. After discovering what was going
on and realising that the bubble will lead to the economy’s collapse, he shorts
the financial sector. And finally, two investors – Charlie Geller (John
Magaro) and Jamie Shipley (Finn Wittrock) seek investment counsel of a retired
banker Ben Rickert (Brad Pitt). They go onto making successful bets against the
housing market, the banker grows angry on them profiting off the downfall of
the U.S. economy and Middle America’s financial doom. They try to sue the
rating agencies for their misleading ratings and fail to do so.
Meanwhile, Burry ends up producing nearly 500% returns
for investors who stay with him through the duration of the housing market's
collapse.
The movie employs a simple and stylish technique of
breaking down the sophisticated lingo associated like CDOs or mortgage-backed
securities. It is highly engaging and anyone with a slight interest in finance
can understand the timeline of events and the various storylines.
II. MARGIN CALL (2011)
Margin Call is probably the most accurate movie ever
made on Wall Street. It is loosely based on Lehman Brothers and shows how the
unnamed bank is on the brink of a disaster. It shows 24 hours in the bank of
frenzy consisting of many phone calls and hurried meetings. It shows a day in
the life of a bank as it scrambles to avoid falling due to the financial
crisis. It depicts how big corporations work and the motivations of the people
working for them. It starts with two women dressed in identical suits firing
80% of the floor. Among the axed staff is the risk manager, Erick Dale, who on
his way out gives a pen drive to his subordinate, Peter
Sullivan. Peter discovers that the bank is massively overleveraged and if the
bank’s portfolio of mortgage-backed securities even decreases by 25%, the firm
will go bankrupt. He goes to the CEO and tells him about the recent discovery
made by him. They have an emergency meeting in the middle of the night to
discuss their options. Their floor manager, Sam Rogers, warns them that selling
off their toxic assets will destroy the bank's relations with their
counterparties as well as cripple the market for the foreseeable future. They
anyway decide to dispose of and sell the toxic assets limiting their exposure.
The next day they ask their traders to sell off the toxic assets and also warn
them that the traders are thereby damaging their reputation and ending their
careers. At the end of the day, the firm can successfully sell their toxic
assets incurring major losses. Rather than pointing any finger, the director
simply portrays that the people responsible are not villains but regular humans
with regular human emotions. It provides a great insight into how an
organisation functions. It shows the reckless risk taken on by big banks in the
run-up of the 2008 financial crises and how they themselves barely understood
trading complex derivative instruments. It depicts how the characters are
concerned by the organisations greater good and not the public good. It
portrays the greed and dishonesty prevalent in Wall Street.
III. WALL STREET (1987)
If one needs to watch only one movie based on the
stock markets, I would suggest them to watch Wall Street. It is one movie every
finance professional needs to watch. It is written and directed by Oliver
Stone. The story revolves around a young and full of ambition stockbroker who
becomes involved with a wealthy, unscrupulous corporate raider. The story
is set in 1985 when a junior stockbroker, Bud Fox (portrayed by Charlie Sheen)
wants to work with his hero, Gordon Gecko, a major Wall Street player. After
days of trying to set an appointment with the Wall Street legend, Bud Makes his
way into his birthday party and tries to convince him to take him under his
wing. In a desperate situation, Bud offers Gordon insider information which he
got to know from his father. Gordon hires Bud as his broker. Bud loses Gordon’s
money. He then gives Bud a chance to redeem himself by spying for him and
getting more insider information. Gordon and Bud both proceed to make a lot of
money together. This attracts the Security and Exchange Boards attention. Bud
pitches a new idea of taking over an airline and soon after he realises that
Gordon is planning to dissolve the airline's assets leave so many unemployed
even though it would make Bud very rich. He feels guilty because of the
destruction of the airlines and is angered by this deceit. He then plans to
disrupt Gordon's plan of dissolving the airline. He manipulates the airlines
stock and convinces Gordon to drop his interest in the airline. Bud goes back
to working for his old organisation only to be arrested for insider trading. He
later helps the authorities get evidence against Gordon by wearing a wire. In
the last seen he can be seen driving to a courthouse for his sentence. This
movie is a tale of greed and corruption prevalent in the securities market. The
movie shows the corporate climate that enables insider trading to flourish and
how corporate raiders become role models for young aspiring people. Is shows a
system which creates paper profits at the cost of diminishing products,
services and jobs. The movie, in the end, reminds us that honesty is in fact
the best policy.
IV. Bazaar (2018)
Bazaar is an Indian movie directed by Gauravv K.
Chawla. It is a thriller about money, power and mostly the Stock Market. The
story revolves around a small-time Allahabad stock trader Rizwan Ahmed. He
arrives in Mumbai with the determination to work with his idol Gujarati
financial maven Shakun Kothari (played by Saif Ali Khan). He feigns his way
into the city's biggest trading firm and figures out how to persuade them to
give him a job. He ropes in a prominent client and with the assistance of his
colleague and girlfriend Priya Rai (who is portrayed by Radhika Apte), he thereby
starts a successful career at the firm. When going to an event with Priya, he
spots Shakun Kothari and offers stock guidance that ends up being right.
Kothari then recruits him as his broker, giving him a notice that he can never
lose any of his money. After his first trade with Kothari's money closes badly,
Rizwan is edging not to lose Kothari's record and illicitly utilizes insider information
from Priya to recover Kothari's misfortunes. Rizwan then goes onto becoming
close to Kothari and his wife Mandira Parekh (who is played by Chitrangda
Singh), visiting Kothari's house and unwinding on his yacht with Priya. At the
same time, Kothari offers Rizwan an opportunity to make considerably more money
when he discovers that the government will start accepting bids from
telecommunication companies for a new undertaking. Kothari tells Rizwan that he
has paid off a minister to choose an organization called Skycom and the two can
rake in huge profits on the arrangement. Kothari gives Rizwan the cash to
purchase Skycom and Rizwan turns into the organization's proprietor. Rizwan
persuades his new brother by marriage Anwar to contribute the entirety of his
investment funds to Skycom shares. Nonetheless, Skycom's offered is dismissed,
and Rizwan is devastated when Kothari auctions the entirety of his Skycom
shares directly before the declaration of the bid winner.
Rizwan finds that Kothari purposely set him up to
accept all negative consequences for Skycom for Kothari's very own financial
benefit and that he orchestrated for Priya to influence him from the starting
point. SEBI agents, led by Rana Dasgupta ( played by Manish Choudhary), hold up
Rizwan for insider trading, however, they actually want to get to Kothari.
Rizwan persuades them that Shakun has been utilizing old methods which won't leave
any proof or trail behind. Utilizing information from Mandira, Rizwan is
finally able to demonstrate that Kothari has been paying off ministers with
precious stones. Shakun is captured and his family leaves him. After the
various court hearings, Shakun is gathered as Priya gives in as a witness to
the pay-offs. Shakun comes out temporarily from jail following month and re-visits
his empty house, his wife and children gone. He calls his secretary and lets
him know, that the "market" is open, getting back to his old ways. In
my opinion, this movie has quite staggering similarities with the 1986 movie
Wall Street. In both of these movies, a young ambitious broker partakes in
insider trading and then snitches on the big market raiders to the authorities.
Both of the movies have the theme of morals over money and vice versa. The
movie while being entertaining is quite informational as well. It is based in
Mumbai and chronicles the world of stockbrokers, businessmen, industrialists
and a host of rich and powerful people. It uses plenty of stock market jargons
and uses them effortlessly so that a common viewer can also understand what’s
happening.
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