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Which of the following is not a possible explanation of the volatility puzzle? Investors may have dynamic loss aversion. Investors may be overconfident. Investors may

Which of the following is not a possible explanation of the volatility puzzle?

  1. Investors may have dynamic loss aversion.
  2. Investors may be overconfident.
  3. Investors may suffer from the money illusion.
  4. Investors may suffer from the conservatism bias.

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