Would you like to know how I managed to ace my Structured Dynamics or PEPS exams? Take it from me, you can’t just learn something overnight. The best way to get an edge over your fellow students is to learn the right way, the long way, the straight and narrow way. You see, in order to really understand and grasp what the big concepts are all about, you need to know the structure and dynamics of financial markets first. In fact, it would be a travesty if you were to get this fundamental class completely wrong and then make major errors when it comes to the rest of the topics.

In my opinion, one needs to at least have a basic knowledge of Microeconomics, Econometrics and Business Economics. It’s not enough to know the ABCs, you also need the foundations to build a solid foundation on. These are high level skills that will help you understand and analyze the markets and the economic theories that underlie them. And don’t think you can start studying these subjects just by taking a simple economics textbook because no matter how nice the author is, you still need to read the pages he chose to focus on.

Now then, do you think you should pay someone to do university exams for you? If so, you are putting yourself in a very bad position indeed. This is because even though having a good grasp of concepts like Microeconomics, Econometrics and Business Economics will give you an advantage over other students, this knowledge alone won’t help you pass the exams. Let me explain.

As I said earlier, a large part of the foundation of these concepts is what economists call The Theory of Gravity. For example, if you are solving a complex problem in micro-economics, it would be impossible for you to have a firm grasp of such concepts as Microeconomics, Business Economics or Theory of Wasting which is the theoretical framework that underpins modern economics. But if you want to apply the theories in your trading, then all you need to know is The Theory of Gravity and you will be fine.

However, when applying these concepts to financial markets, your needs are slightly different. For instance, in a free market for shares, what occurs is the price will fluctuate up and down. However, since the share holders are allowed to buy and sell freely, there will be a natural tendency for prices to move upwards. Therefore, this theory doesn’t apply and those who want to learn about the mechanics of the market must look elsewhere.

A more realistic way of looking at financial markets is to use modern financial economics textbooks that lay out the structure and dynamics of the market using mathematical tools to show how the prices of shares are driven by economic concepts. Once again, though, none of this applies if you want to take my exam for me. However, this can help with understanding some of the more abstract concepts.

In addition to this, students also need to understand how the various economic factors affect each other to see how they may interact with one another. As mentioned above, many firms operate within tight margins and therefore do not have much room to run up debt. However, if the credit rating becomes an issue, then the firms may find themselves in great difficulty.

Studying the financial markets is not just about knowing how they work; it is also about understanding why they work. This is why it is crucial to get a good grasp of the theories that underpin them. This is the only way that you can learn how to harness these forces so that you can use them to your own benefit. It is worth remembering that the best financial management firms will be those with the most comprehensive understanding of the markets. The more I read, the more I realise just how important this is.