MIDTERM IN BEHAVIORAL FINANCE

This is the emotional reaction to having made an error of judgement.

It is a phenomenon in which in the absence of better information, investors assume current prices are about right.

It is a field of finance that proposes psychology-based theories to explain stock market anomalies such as severe rises or falls in stock price.

This theory explains the regularity in human behaviors when assessing risk under uncertainty.

These are the (2) Two Aspects of behavioral finance

These are the (2) Two Aspects of behavioral finance

One of the behavioral finance theories is when the managers overestimate the probability of success in particular when they think of themselves as experts.

He suggests that we have an inner drive to hold all our attitudes and beliefs in harmony and avoid disharmony.

One of the methodologies of cognitive dissonance is to achieve some desired goal and reduced by exaggerating the desirability of the goal.

It is the basic principles that include a political order, nationalism, morality, and loyalty.