- Quantrade Journal of Complex Systems in Social Sciences
- Vol: 1 Issue: 1
- A Theoretical Perspective on Behavioral Finance With Lagrangian Approach
A Theoretical Perspective on Behavioral Finance With Lagrangian Approach
Authors : Hakan Inaç
Pages : 22-27
View : 9 | Download : 8
Publication Date : 2019-12-11
Article Type : Research
Abstract :Behavioral finance is a combination of economics and finance. Behavioral finance studies how emotions and biases affect financial markets. The behavioral finance approach includes the prospect theory and the efficient market hypothesis. Prospect theory deals with investors' attitudes towards stocks, while the effect of prices on resources is examined in the efficient market hypothesis. Behavioral finance is interested in the impact of factors such as overconfidence, mental accounting, and gambler's fallacy among the factors affecting the investor's behaviors. This paper aims to explain behavioral finance and the effect of behavioral finance on the market value of a company.Keywords : Financial Market, Behavioral Finance, lagrange