A common starting point
Felix Prehn, the economist and former investment banker who founded Goat Academy, made his first investment at 18. He followed a recommendation into a biotechnology fund and lost 45% of the money. The lesson was not that markets are dangerous. It was that investing on someone else's conviction, without understanding what you own or why, is not investing at all.
Most people who lose money in stocks do so for the same reason: they act before they understand the rules. The rest of this guide sets out those rules in the order a structured education would teach them.
Stock market 101
The first stage covers the mechanics. What a share represents, how exchanges match buyers and sellers, what the bid and ask are, how dividends and buybacks return cash, and why prices move. It also covers the vocabulary of orders (market, limit, stop) and account types, so that the practical steps of buying are never a source of confusion.
This stage also introduces the main participants: institutional investors, market makers, and individuals, and how their different objectives and time horizons shape price behaviour. Understanding who is on the other side of a trade is the beginning of thinking like a professional.
Investing strategy
The second stage is about deciding what kind of investor you are. Three approaches provide the foundation.
- Index and ETF investing. Owning the whole market at low cost, accepting the market return, and focusing effort on saving rate and staying invested.
- The Buffett approach. Buying shares in high quality businesses at reasonable prices and holding them for years, treating a share as part ownership of a company rather than a ticker to be traded.
- Asset allocation. Deciding how much to hold in stocks, bonds, and cash based on time horizon and risk tolerance, and rebalancing when markets move the mix away from the plan.
Most investors combine these: a diversified core, a selection of individual holdings they understand, and an allocation that lets them sleep through a downturn.
Analysing a company
The third stage teaches how to read the financial statements. The income statement shows revenue, costs, and profit. The balance sheet shows what the company owns and owes. The cash flow statement shows whether the reported profit is turning into actual cash. Together they reveal whether a business is growing, how much debt it carries, and how much it is really earning.
Valuation follows analysis. Ratios such as price to earnings and price to sales provide a quick comparison across companies. A discounted cash flow (DCF) model estimates what a business is worth today based on the cash it is expected to generate in future. No model is precise, but the discipline of building one forces an investor to state assumptions explicitly.
Reading price behaviour
Technical analysis studies price and volume to understand what other market participants are doing. It does not predict the future; it describes the present balance of supply and demand and helps with timing and risk control.
- Support and resistance. Price levels where buying or selling has repeatedly appeared.
- Trend and moving averages. Whether price is making higher highs or lower lows, and how it sits relative to its average over 50 or 200 days.
- Momentum indicators. Tools such as the Relative Strength Index (RSI) and Williams %R measure whether a move is stretched.
- Fibonacci retracements. Ratios used to estimate where a pullback within a trend might find support.
- Chart patterns. Recurring formations such as consolidations and breakouts that describe how a market is digesting information.
Used alongside fundamental analysis, these tools help an investor decide when to act on a conclusion already reached about a company's value.
Economics and psychology
The final stage places individual decisions in context. Interest rates, inflation, central bank policy, and the business cycle affect every company's earnings and every investor's discount rate. An investor who understands how rate decisions move markets is less likely to be surprised by them. The Goat Academy insights section publishes regular notes on these topics.
Psychology is the part of the curriculum that most determines results. Fear of missing out, loss aversion, anchoring to a purchase price, and overconfidence after a winning streak are documented patterns that cause investors to buy high and sell low. Rules written in advance, position sizing, and a review schedule are the practical defences.
Where to learn this in full
This page is a map, not the territory. The Wall Street Protocol is the Goat Academy programme that teaches each of these stages in depth, with the analytical framework Felix developed during his career in investment banking. The free masterclass provides an introduction to the method before committing to the full programme.
- Wall Street Protocol
The complete curriculum, from market mechanics to portfolio management.
- Free masterclass
An introduction to the method before the full programme.
- Programme for service members
Goat Academy education provided at no cost to active and retired service members.
Key points
What to take from this guide
- 01Losses usually come from acting on borrowed conviction rather than understanding.
- 02A complete education runs in order: mechanics, strategy, company analysis, price behaviour, context.
- 03Fundamental analysis tells you what to buy; technical analysis helps with when and how much.
- 04Psychology decides results, and written rules are the practical defence.
Goat Academy is an online financial education institution founded by economist and former investment banker Felix Prehn. It is published by Skillset Solutions FZ-LLC.
Goat Academy provides education only. Nothing on this site is financial, investment, or tax advice, and no outcome, return, or income is promised or implied. Trading and investing carry risk, including the loss of capital.
Questions about this page can be sent to [email protected].