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Behavioral Finance Fundamentals

The document outlines the fundamentals of behavioral finance, covering key concepts such as behavioral biases, prospect theory, mental accounting, and market anomalies. It also discusses emotional factors, behavioral corporate finance, nudges, social influence, neurofinance, and applications in personal finance. Additionally, it addresses critiques and limitations of behavioral finance in relation to traditional finance.

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Ananya
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2 views

Behavioral Finance Fundamentals

The document outlines the fundamentals of behavioral finance, covering key concepts such as behavioral biases, prospect theory, mental accounting, and market anomalies. It also discusses emotional factors, behavioral corporate finance, nudges, social influence, neurofinance, and applications in personal finance. Additionally, it addresses critiques and limitations of behavioral finance in relation to traditional finance.

Uploaded by

Ananya
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Behavioral Finance Fundamentals

1.​ Behavioral Biases​


1.1 Overconfidence Bias​
1.2 Anchoring​
1.3 Herd Behavior​
1.4 Loss Aversion​
1.5 Status Quo Bias​
1.6 Confirmation Bias​
1.7 Recency Bias
2.​ Prospect Theory​
2.1 Gains and Losses Asymmetry​
2.2 Risk Aversion vs. Risk-Seeking Behavior
3.​ Mental Accounting​
3.1 Categorization of Money​
3.2 Spending Behavior
4.​ Market Anomalies​
4.1 January Effect​
4.2 Momentum Effect​
4.3 Value Effect
5.​ Heuristics​
5.1 Representativeness Heuristic​
5.2 Availability Heuristic
6.​ Behavioral Asset Pricing​
6.1 Psychological Factors in Asset Valuation​
6.2 Deviations from CAPM
7.​ Emotional Factors​
7.1 Impact of Fear and Greed​
7.2 Regret and Decision-Making
8.​ Behavioral Corporate Finance​
8.1 Managerial Overconfidence​
8.2 Decision-Making Errors in Corporations
9.​ Nudges and Behavioral Interventions​
9.1 Guiding Decisions with Nudges​
9.2 Examples of Behavioral Interventions
10.​The Role of Social Influence​
10.1 Peer Pressure and Financial Decisions​
10.2 Cultural and Social Norms
11.​Neurofinance​
11.1 Brain Imaging in Financial Decision-Making​
11.2 Neurological Basis of Risk and Reward
12.​Applications in Personal Finance​
12.1 Behavioral Insights in Budgeting​
12.2 Saving and Investing​
12.3 Managing Debt
13.​Critiques of Behavioral Finance​
13.1 Limitations of Behavioral Finance​
13.2 Integration with Traditional Finance

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