Unit name | Behavioural Finance |
---|---|
Unit code | EFIMM0016 |
Credit points | 15 |
Level of study | M/7 |
Teaching block(s) |
Teaching Block 2 (weeks 13 - 24) |
Unit director | Dr. Sonny Biswas |
Open unit status | Not open |
Pre-requisites |
None |
Co-requisites |
None |
School/department | School of Accounting and Finance - Business School |
Faculty | Faculty of Social Sciences and Law |
The purpose of the unit is to provide an understanding of psychological biases which affect financial decision-making and to consider the related empirical evidence.
The first part of the unit will provide a brief introduction to the general models in Behavioural Finance (such as Prospect Theory, Ambiguity Aversion and Herding).
The second part of the unit will focus on the implications of behavioural biases for Corporate Finance. For example, it will cover topics such as security issuance and market timing, dividend policy decisions and wealth destruction in mergers and acquisitions arising from managerial overconfidence.
By the end of the unit a student is expected to:
Teaching will be delivered through a combination of synchronous and asynchronous sessions including lectures, tutorials, drop-in sessions, discussion boards and other online learning opportunities
This unit will be assessed by 100% exam
Reading and References
Textbooks:
Thaler, R. (2016) Misbehaving: The making of behavioural economics, Norton.
Burton, E. and Shah, S. (2013) Behavioural finance: Understanding the social, cognitive and economic debates, Wiley.
Ackert, L.F. and Deaves, R. (2009) Behavioural finance: Psychology of decision making and markets, South-Western.
Shefrin, H. (2007) Behavioural corporate finance: decisions that create value, McGraw-Hill.
Damodaran, (2010) Applied corporate finance, John Wiley & Sons.
Malkiel, B. (2008) A random walk down wall street: The time-tested strategy for successful investing, Norton.