Themes of behavioral finance asset include:
1: Investors err in making investment decisions because they rely on ________.
2: Investors are influenced by form as well substance in making ________.
3: Prices in the financial market are affected ________ and decision frames.

Question

Quizplus · Accepted Answer

1) Investors rely on rules of thumb as shortcuts for making investment decisions, which can lead to errors.
2) Investors are influenced by how information is presented (form) as well as the actual information itself (substance) in making investment decisions.
3) Prices in the financial market can be affected by both heuristics and biases (decision frames) that investors use in their decision-making process. All of these themes are captured in choice D.

Themes of Behavioral Finance Asset Include