Behavioral Investing

Through this course, you will learn how individuals and firms make financial decisions, and how those decisions might deviate from those predicted by traditional financial or economic theory.

We will explore the nature of these biases and their origins, using insights from psychology, neurosciences and experimental economics on how the human mind works. From these biases, you will be able to examine how the insights of behavioral finance complement the traditional finance paradigm. We also look at the micro and macro biases. Finally, we will explore how these insights describe more complicated topics such as fat tail events and financial crises.

• Behavioral Biases in Finance - Part 1
• This module discusses the common behavioral biases experienced by individuals. All the biases are divided into 3 parts. After completing this module you will be able to explain different biases such as Overconfidence, Base rate neglect, Anchoring and adjustment, Cognitive Dissonance, Availability, Self-Attribution and Illusion of Control Bias.
• Behavioral Biases in Finance - Part 2
• This module discusses the common behavioral biases experienced by individuals. All the biases are divided into 3 parts. This module deals with the second part. After completing this module, you will be able to explain different biases such as Conservatism, Ambiguity Aversion, Endowment, Self-control, Optimism, Mental accounting, Confirmation and Loss aversion.
• Behavioral Biases in Finance - Part 3
• This module discusses the common behavioral biases experienced by individuals. All the biases are divided into 3 parts. This module deals with the third part. After completing this module, you will be able to explain different biases such as Hindsight, Recency, Regret Aversion, Framing, Status Quo and sample size neglect.
• Psychographic models in Finance
• This module discusses the 3 psychographic models in behavioral finance. After finishing this module you will be able to explain the three psychographic models and differentiate between them.