Behavioral Finance ((3 Credits))

Catalog description

The course focuses on the key psychological barriers to value-maximizing behaviors along with options available for managers to mitigate these barriers. It covers the theory and practice of behavioral finance, including a history of financial bubbles, failures, financial market anomalies, and the role of heuristics ('cognitive shortcuts') and biases that drive human behavior. Other topics in this course include prospect theory, common investment mistakes, the role of randomness in finance, and practical applications of behavioral finance. The goal is to help students learn how to benefit the analysis and understanding of financial markets by using additional tools of finance. This course was previously FIN-655508.