Description
New Century Publications Behavioural Finance and Investment Strategies by Ahmed Jaynal Uddin
Behavioural finance, as a part of behavioural economics, is the study of effects of psychology on investors and financial markets. It focuses on explaining why investors often appear to lack self-control, act against their own best interest, and make decisions based on personal biases instead of facts.At its core, behavioural finance is about identifying and explaining inefficiency and mispricing in the financial markets. It uses experiments and research to demonstrate that humans and financial markets are not always rational, and the decisions they make are often flawed.In recent years, behavioural finance has been embraced in the academic and financial community as a sub-field of behavioural economics, influenced by economic psychology. By showing how, when, and why behaviour deviates from rational expectations, behavioural finance provides a blueprint to help everyone make better and more rational decisions when it comes to their finances. Behavioral finance is now also being implemented in financial advisor business models and client engagement practices.This book is an attempt to highlight the issues and challenges related to behavioural finance. It contains 14 research articles which have been organized into 2 parts.Part I (chapters 1 and 5) is titled, “Conceptual and Theoretical Issues Related to Behavioural Finance and Investment Decisions”. Topics discussed in this part include, inter alia, role of behavioural finance in investment decisions, fundamentals of behavioural finance and investment strategies, and influence of biases in investment decision-making. Part II (chapters 6 to 14) is titled, “Studies Related to Behavioural Biases and Investment Strategies”. It deals with investors’ irrationality, rapacity and panic, voluntary disclosure, mutual fund investors, relationship between behavioural finance and social media, and other empirical studies.