Beyond Greed and Fear

Beyond Greed and Fear : Understanding Behavioral Finance and the Psychology of Investing

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Description

Even the best Wall Street investors make mistakes. No matter how savvy or experienced, all financial practitioners eventually let bias, overconfidence, and emotion cloud their judgement and misguide their actions. Yet most financial decision-making models fail to factor in these fundamentals of human nature. In "Beyond Greed and Fear", the most authoritative guide to what really influences the decision-making process, Hersh Shefrin uses the latest psychological research to help us understand the human behaviour that guides stock selection, financial services, and corporate financial strategy. Shefrin argues that financial practitioners must acknowledge and understand behavioural finance - the application of psychology to financial behaviour - in order to avoid many of the investment pitfalls caused by human error. Through colorful, often humorous real-world examples, Shefrin points out the common but costly mistakes that money managers, security analysts, financial planners, investment bankers, and corporate leaders make, so that readers gain valuable insights into their own financial decisions and those of their employees, asset managers, and advisors. According to Shefrin, the financial community ignores the psychology of investing at its own peril. "Beyond Greed and Fear" illuminates behavioral finance for today's investor. It will help practitioners to recognize - and avoid - bias and errors in their decisions, and to modify and improve their overall investment strategies.show more

Product details

  • Hardback | 402 pages
  • 164 x 236 x 38mm | 762.03g
  • Oxford University Press Inc
  • New York, United States
  • English
  • Revised
  • 2nd Revised edition
  • numerous figures
  • 0195161211
  • 9780195161212
  • 2,021,913

Review quote

Hersh Shefrin's book is seeking to make behavioral finance understandable outside the academic community ... Shefrin's book provides us with rich details drawn from the world of investments. ... an ideal reference for those who serve the pension and retirement community ... In the academic world, it could be a supplemental reading for undergraduate or MBA investment courses, or it may guide the non-specialist seeking a readable summary of recent literature .. Non-experts looking for a useful reference in the investment realm will certainly want to read this book.show more

About Hersh Shefrin

Hersh Shefrin holds the Mario L. Belotti Chair in Finance at the Leavey School of Business, Santa Clara University.show more

Table of contents

Preface; PART I: WHAT IS BEHAVIORAL FINANCE; 1. Introduction; 2. Heuristic-Driven Bias: The First Theme; 3. Frame Dependence: The Second Theme; 4. Inefficient Markets: The Third Theme; PART II: PREDICTION; 5. Trying to Predict the Market; 6. Sentimental Journey: The Illusion of Validity; 7. Picking Stocks to Beat the Market; 8. Biased Reactions to Earnings Announcements; PART III: INDIVIDUAL INVESTORS; 9. "Get-Evenitis": Riding Losers Too Long; 10. Portfolios, Pyramids, Emotions, and Biases; 11. Retirement Saving: Myopia and Self-Control; PART IV: INSTITUTIONAL INVESTORS; 12. Open-Ended Mutual Funds: Misframing, "Hot Hands", and Obfuscation Games; 13. Closed-End Funds: What Drives Discounts?; 14. Fixed Income Securities: The Full Measure of Behavioral Phenomena; 15. The Money Management Industry: Framing Effects, Style "Diversification", and Regret; PART V: THE INTERFACE BETWEEN CORPORATE FINANCE AND INVESTMENT; 16. Corporate Takeovers and the Winner's Curse; 17. IPOs: Initial Underpricing, Long-term Underperformance, and "Hot-Issue" Markets; 18. Optimism in Analysts' Earnings Predictions and Stock Recommendations; PART VI: OPTIONS, FUTURES, AND FOREIGN EXCHANGE; 19. Options: How They're Used, How They're Priced, and How They Reflect Sentiment; 20. Commodity Futures: Orange Juice and Sentiment; 21. Excessive Speculation in Foreign Exchange Markets; Final Remarks; Notes; References; Credits; Indexshow more

Rating details

176 ratings
3.76 out of 5 stars
5 28% (49)
4 31% (55)
3 31% (54)
2 10% (18)
1 0% (0)
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