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Behavioral Finance vs. Market Efficiency by fadhli lutfi is a document available to read on EtoBox.
What is Behavioral Finance vs. Market Efficiency about?
Traditional finance assumes investors are rational, while behavioral finance argues people exhibit psychological biases. Behavioral finance bridges economics and psychology, showing biases like overconfidence and framing losses as worse than gains. Markets can still be efficient even if individuals are irrational, but individuals make major mistakes. Behavioral finance critiques how people process information incorrectly and make inconsistent decisions due to heuristics and biases. Prospect theory proposes
- Author
- fadhli lutfi
- Language
- EN