Behavioral finance: psychology, decision-making, and markets

Table of content

Introduction.
Introduction.
SECTION I: CONVENTIONAL FINANCE, PROSPECT THEORY AND MARKET EFFICIENCY.
1: Foundations of conventional finance: Expected utility.
2: Foundations of conventional finance: Asset pricing theory and market efficiency.
3: Prospect theory, framing and mental accounting.
4: Limits to arbitrage, anomalies and investor sentiment.
SECTION II: BEHAVIORAL SCIENCE FOUNDATIONS.
5: Heuristics and biases.
6: Overconfidence.
7: Emotion.
SECTION III: INVESTOR BEHAVIOR.
8: Investor behavior stemming from heuristics and biases.
9: The impact of overconfidence on investor decision-making.
10: Emotion-based investor behavior.
SECTION IV: SOCIAL FORCES.
11: Social forces: Selfishness or altruism?
12: Social forces and behavior.
SECTION VI: MARKET OUTCOMES.
13: Behavioral explanations for anomalies.
14: Aggregate stock market puzzles.
SECTION V: CORPORATE FINANCE.
15: Irrational markets.
16: Irrational managers.
SECTION VII: RETIREMENT, PENSIONS, EDUCATION, DEBIASING AND CLIENT MANAGEMENT.
17: Understanding retirement saving and investment behavior and improving DC pensions.
18: Debiasing, education, and client management.
SECTION VIII: MONEY MANAGEMENT.
19: Money management and behavioral investing.
20: Neurofinance and trading.

Now you can offer your students a structured, applied approach to behavioral finance with the first academic text of its kind--Ackert/Deaves' BEHAVIORAL FINANCE: PSYCHOLOGY, DECISION MAKING, AND MARKETS. This comprehensive text--ideal for your behavioral finance elective-- links finance theory and practice to human behavior. The book begins by building upon the established, conventional principles of finance that students have already learned in their principles course. The authors then move into psychological principles of behavioral finance, including heuristics and biases, overconfidence, emotion and social forces. Students learn how human behavior influences the decisions of individual investors and professional finance practitioners, managers, and markets. Your students gain a strong understanding of how social forces impact people's choices. The book clearly explains what behavioral finance indicates about observed market outcomes as well as how psychological biases potentially impact the behavior of managers. Students learn the implications of behavioral finance on retirement, pensions, education, debiasing, and client management. This book is unique as it spends a significant amount of time examining how behavioral finance can be used effectively by practitioners today. The book's solid academic approach provides opportunities for students to utilize theory and complete applications in every chapter. A wide variety of end-of-chapter exercises, discussion questions, simulations and experiments reinforce the book's applied approach, while useful instructor supplements ensure you have the resources to clearly present theories of behavioral finance and their applications.