Behavioral finance – a qualitative approach for the Brazilian investor

• DOI: 10.22533/at.ed.5582242202085

• Palavras-chave: Behavioral Finance; Heuristics; biases; Decision Processes

• Keywords: Behavioral Finance; Heuristics; biases; Decision Processes

• Abstract:

  One of the main debates in the economic sphere of Finance concerns the assumptions made by its more traditional theories, such as: Expected Utility Theory (TUE) and Efficient Markets Hypothesis (HME), the result of studies by Fama (1970) and Markowitz (1952), respectively. Specifically, issues related to the rationality of investors and economic agents. In this context, several studies have emerged with the aim of improving the dominant theoretical models, inserting to them behavioral aspects that were previously disregarded. These researches gave rise to a new and important field of study called behavioral finance, which began with Simom (1978) and later continued by Kahneman and Tversky (2002), followed by Sunstein and Thaler (2017), chronologically. The remarkable growth of this approach, which brings emotional and irrational human aspects, such as heuristics and biases, into finance theory, has been motivated, in particular, by the attempt to explain a series of phenomena regularly observed in the financial market, in in the decision-making process and that are incompatible, in part, with the theories of classical models of finance.

• Número de páginas: 15