A Changing Dyna-WPS Office
A Changing Dyna-WPS Office
Biases Studied
influences and biases affect the financial behaviors of investors and financial
practitioners. Moreover, influences and biases can be the source for explanation of all
types of market anomalies and specifically market anomalies in the stock market, such
Behavioral finance can be analyzed from a variety of perspectives. Stock market returns
are one area of finance where psychological behaviors are often assumed to influence
market outcomes and returns but there are also many different angles for observation.
The purpose of classification of behavioral finance is to help understand why people
make certain financial choices and how those choices can affect markets. Within
behavioral finance, it is assumed that financial participants are not perfectly rational and
self-controlled but rather psychologically influential with somewhat normal and selfcontrolling
tendencies.
One of the key aspects of behavioral finance studies is the influence of biases. Biases
can occur for a variety of reasons. Biases can usually be classified into one of five key
can be very important when narrowing in on the study or analysis of industry or sector
KEY TAKEAWAYS