Title: Investor psychology: a behavioural explanation of six finance puzzles
Abstract: This paper surveys the behavioural finance explanation of six puzzles of finance. These puzzles are: stock price under- and overreactions, excessive trading and the gender puzzle, financial hypes and panic, the equity premium puzzle, the winner/loser puzzle and the dividend puzzle. After an introduction of prospect theory and a description of heuristics and biases in the judgment of information, the paper applies behavioural insights to explain the puzzles.
Publication Year: 2004
Publication Date: 2004-01-01
Language: en
Type: article
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Cited By Count: 3
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