FIN30190 Behavioural Finance

Academic Year 2023/2024

*** Not available in the academic year indicated above ***

Behavioural Finance applies the theoretical and experimental methodologies and results of the cognitive sciences to questions concerning the ways in which individuals actually make financial decisions, in contrast to the traditional idealised economic models of choice behaviour. It also considers the impact of various individual behavioural biases, feelings, and social forces on aggregate market behaviour, addressing issues such as market efficiency and financial crises.

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Curricular information is subject to change

What will I learn?

Learning Outcomes:

On completing this module, you will be able to:
Contrast traditional and behavioural finance perspectives on investor decision making and asset pricing.
Discuss commonly recognised behavioural biases and their implications for investment decision making.
Discuss common problems in the real-world portfolio formation.
Evaluate how behavioural biases and social forces affect aggregate market behaviour and market efficiency.

Indicative Module Content:

1. Expected utility theory
2. Market efficiency and challenges
3. Prospect theory
4. Framing effect
5. Mental accounting and disposition effect
6. Representativeness and familiarity bias
7. Overconfidence
8. Portfolio formation
9. Emotion, investor sentiment, and bubbles
10. Social interaction and social forces
11. Self-control, and retirement saving

How will I learn?

Student Effort Type	Hours
Lectures	24
Tutorial	12
Specified Learning Activities	30
Autonomous Student Learning	50
Total	116

Am I eligible to take this module?

Requirements, Exclusions and Recommendations

Learning Recommendations:

Introduction to Finance
Principles of Finance
Portfolio Management and Investments

Module Requisites and Incompatibles

Not applicable to this module.

How will I be assessed?

Assessment Strategy

Description	Timing	Open Book Exam	Component Scale	Must Pass Component	% of Final Grade
Project: Group project plus presentation	Throughout the Trimester	n/a	Graded	No	25
Examination: Exam with a mix of MCQ and open-ended questions.	Unspecified	No	Graded	No	75

Carry forward of passed components
Yes

What happens if I fail?

Resit In	Terminal Exam
Autumn	No

Assessment feedback

Feedback Strategy/Strategies

• Group/class feedback, post-assessment

How will my Feedback be Delivered?

Not yet recorded.

Reading List

Main reference/textbook: Ackert, L. and Deaves, R. (2010) Behavioral Finance: Psychology, Decision-Making, and Markets. Mason: Cengage Learning.
Other readings will be assigned during the course.

Associated Staff

Name	Role
Mr Yuting Chen	Lecturer / Co-Lecturer

When is this module offered?


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