HOW BEHAVIORAL FINANCE CAN CHANGE THE THEORY AND PRACTICE OF INVESTMENT MANAGEMENT INDUSTRY

Koffi Hua Wilfried Serge

Abstract


Behavioral finance helps any potential investor inside or outside the industry to understand how investors make decisions, to design financial products that suit best to individual investors, to understand how institutional investors trade and to provide suitable regulation ( for example, short selling). In other words to take advantage of other investors, to judge the cognitive biases and errors, and for the majority of investors to realize their mistakes before the investment of those price deviation varieties, and a reasonable price point, the unwinding profits. This article analyses the change that behavioral finance can bring inside the investment management industry.

 


References


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Shleifer, A. (2000). Inefficient Markets: An Introduction to Behavioural Finance. Oxford, U: Press,Oxford.


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ISSN : 2251-1555