The Story of Behavioral Finance

by Brandon Adams



Book Details

Language : English
Publication Date : 6/1/2006

Format : Softcover
Dimensions : 6x9
Page Count : 82
ISBN : 9780595396900

About the Book

This book will take your understanding of finance to the next level. The Story of Behavioral Finance is about "finance in the real world"-it's finance theory with real people and real institutions.

What happens when your portfolio manager sets out not to maximize your return but rather to maximize his own compensation and minimize his own career risk? Why didn't rational investors short high-flying Internet companies back in 1999? Why was it that so many of the firms that went public in 1999 and 2000 for hundreds of millions of dollars subsequently went bankrupt? These are the types of questions that will be answered in this book.

The Story of Behavioral Finance will cover a lot of ground. We will cover the two main strands of behavioral finance, investor psychology and limits to arbitrage, and we'll apply these concepts to a wide array of financial market phenomena. We will explore, for example, why it is that almost no one seems to "beat the market" despite that fact that there are often easily spotted price inefficiencies.

About the Author

Brandon Adams is a fourth year doctoral student at Harvard Business School. He designed a course in behavioral finance three years ago, and he?s since taught it eight times to Harvard undergraduates. He is the author of one previous book, Broke: A Poker Novel.

Brian Finn graduated from Harvard in June 2006. He took Brandon?s behavioral finance tutorial in Spring 2005.