Behavioral Finance

286 Posts

Book Review: Uncertainty, Expectations, and Financial Instability

Uncertainty, Expectations, and Financial Instability

This book presents insights into the formation of expectations and the causes of market instability by updating and applying the forgotten theories of Nobel Prize–winning economist Maurice Allais. Focusing on alternatives to the rational expectations theory, the author shows how memory and strength of signal influence the way investors form their views of the market. He applies these “old” concepts on expectation formation to recent market events to explain how alternative expectation formulations can lead to market instability. Read more

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Best of 2015: Stories for Investors

Best of 2015: Stories for Investors

Jason Voss, CFA, shares his choices for the best stories for investors in 2015. These range from central bank influence on the economy, changes afoot in China, the preeminence of demographics in explaining future economic states, the current state of finance, and even news in quantum physics! Read more

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