The Psychology of Investing

The first book of its kind to delve into the fascinating and important subject of the psychology affecting investment. No other book provides this information because traditional finance focuses on developing the tools in which investors use to optimize expected return and risk. The author believes that understanding the psychology of investing is just as important as knowing the traditional investment topics. Combines behavioral knowledge from psychology, management, marketing, economics, and finance. Uses investment as well as non investment examples. For financial planners, investment managers, individual investors, or to be used as a training manual or reference in financial companies.

Traditional finance has focused on developing the tools that investors use to optimize expected return and risk. Understanding the motivations behind this behavior is extremely important when applying these financial tools. This is the first text of its kind to delve into the fascinating and important subject of the psychology affecting investments!

Includes coverage of:

• Behavioral knowledge—Draws from psychology, management, marketing, economics, and finance.
  Students can easily understand the relevance, use, and importance of the material presented across different business disciplines.
• Examples of psychological biases—Illustrated with examples of everyday behavior, and the effect of psychological biases on investment decisions is then described.
  Shows students bow to overcome their biases to increase their wealth!
• Both investment as well as non-investment examples—Used throughout the text to illustrate how different concepts relate to investing.
  This approach first helps students see how the behavior covered relates to everyday life and then ties the behavior to investment decisions.