Behavioral Finance

Bachelor-level knowledge of accounting and finance.

By the end of the course students will achieve the following intended learning outcomes:

• Students will demonstrate solid knowledge of different topics in the area of behavioral finance taking into consideration various aspects of limits to arbitrage.
• Students will apply critical thinking to evaluate investments and ethics in the financial markets.
• Students will review calibration measure and normative probability problems to improve upon their natural human tendency to create systematic investing errors

To sum up, regarding generic skills, the course will develop decision making and analytical and critical thinking skills; and more specifically the ability to avoid psychological biases when making and evaluating investments (that is, by minimizing known biases improved financial problem solving skills will result). By the end of this course students should be able to develop a method for investing in the financial markets that minimizes irrational behavior and maximizes risk adjusted returns.

1. Kihn, J., Behavioral Finance 201: Normative Finance Deprogramming (2015) (the primary required reading or reference).
2. Kihn, J., Behavioral Finance 101: Cognitive Financial Economics (2011) (nonoverlapping chapters or sections with Behavioral Finance 101).
3. Material selected by the lecturer (currently two articles).

Right to participate:
Master’s Degree students in Finance. Master’s level exchange students in Finance.

Further Information:
Provided by the lecturer. Also, this course is not recommended as a correspondence course.