Question
Traditional financial theory has tended to be based on fundamentals analysis and assumes that financial actors all act rationally to achieve their financial and investment
Traditional financial theory has tended to be based on fundamentals analysis and assumes that financial actors all act rationally to achieve their financial and investment goals. Recently, some scholars have begun to question the rationality assumption and have asserted that many financial decisions have a behavioral aspect that cannot be ignored. Please provide a discussion of what is meant by Behavioral Finance, how it differs from traditional finance, and give some examples of biases or other psychological frames that may be seen as having an impact on investment decision making.
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