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Behavioral Finance

Behavioral finance highlights that human biases can lead to mispricing in markets, which may mislead firms regarding investment decisions. This can result in resource misallocation and indicates a need for more coherent theories in the field. Investors should be aware of these biases, with indexed investing often being the safest approach.

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Kias
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2 views

Behavioral Finance

Behavioral finance highlights that human biases can lead to mispricing in markets, which may mislead firms regarding investment decisions. This can result in resource misallocation and indicates a need for more coherent theories in the field. Investors should be aware of these biases, with indexed investing often being the safest approach.

Uploaded by

Kias
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

Theme Implication
Says…
Happens due to human
Mispricing Not always exploitable.
biases.
May mislead firms on Resource misallocation
Market signals
where to invest. risk.
Currently unstructured
Theory and sometimes Needs more coherence.
contradictory.
Be aware of biases and Indexed investing is
Investor Action
limits. often safest.

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