NBA 5980 - Behavioral Finance

Spring. 1.5 credits. Student option grading (no audit).

M. Baron.

Behavioral Finance studies financial market phenomena that occur due to cognitive biases of market participants. This course introduces the conceptual framework of behavioral finance and investor psychology and then applies the framework to issues in stock market investing, real estate investing, and banking. Topics include: (1) investor psychological biases and irrational trading behavior; (2) limits of arbitrage and the risks of leveraged convergence trading; (3) behavioral finance trading strategies; (4) stock market and real estate bubbles; and (5) credit booms and financial crises.