Recent Research on Behavioral and Experimental Finance

A special issue of Journal of Risk and Financial Management (ISSN 1911-8074). This special issue belongs to the section "Applied Economics and Finance".

Deadline for manuscript submissions: closed (31 July 2023) | Viewed by 5248

Special Issue Editor


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Guest Editor
Associate Professor, Business School, Durham University, Mill Hill Lane, Durham DH1 3LB, UK
Interests: behavioural finance; emerging markets; institutional investors

Special Issue Information

Dear Colleagues,

Neoclassical finance postulates that individuals are rational information processors, who reach decisions based on precise mathematical tools, independent of their emotions and with the purpose of maximizing their utility. This theoretical construct has largely been challenged since the 1980s, via a series of findings from behavioral and experimental finance studies; these findings showcased that human behavior often reflects departures from the rational paradigm, both at the individual level (as the presence of a host of biases and heuristics suggests) and the collective level (given the broad evidence in favor of herding and trend-chasing phenomena internationally). Evidence on the above hails from analytical (i.e., mathematical modelling based), experimental and empirical (relying on both micro/transactions and aggregate data) finance studies covering a broad cross section of asset classes and markets of various stages of development. These deviations from rationality can have severe repercussions for social welfare and potentially foster market destabilization; thus, they are of clear relevance to regulatory and policy-making authorities. Submissions are invited that cover the whole spectrum of behavioral and experimental finance applications, including financial decisions and biases, behavioral corporate finance, behavioral asset pricing, emotions, sentiment, social finance, culture, superstitions, retail and institutional investors’ behavior, herding and bubbles, to mention just a few.

Dr. Vasileios Kallinterakis
Guest Editor

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Keywords

  • behavioral biases and financial decisions
  • behavioral corporate finance
  • behavioral asset pricing
  • investors' sentiment and emotions
  • retail and institutional investors' behavior
  • herding and bubbles

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Published Papers (1 paper)

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Research

19 pages, 976 KiB  
Article
Value and Contrarian Investment Strategies: Evidence from Indian Stock Market
by Sharneet Singh Jagirdar and Pradeep Kumar Gupta
J. Risk Financial Manag. 2023, 16(2), 113; https://doi.org/10.3390/jrfm16020113 - 10 Feb 2023
Cited by 4 | Viewed by 4371
Abstract
Value and contrarian investment strategies are two basic approaches which are widely used by investors worldwide. Both value and contrarian investment strategies are assumed to pick the same stocks even though the approach to picking the stocks is different. Furthermore, both investment strategies [...] Read more.
Value and contrarian investment strategies are two basic approaches which are widely used by investors worldwide. Both value and contrarian investment strategies are assumed to pick the same stocks even though the approach to picking the stocks is different. Furthermore, both investment strategies are supposed to work in various forms of market efficiency. The present study aims to empirically review and analyze the investment strategies, value and contrarian, by creating a portfolio of returns of listed stocks in India’s Bombay Stock Exchange (BSE) over a period from 1990–91 to 2018–19. A Venn diagram is used to explain the selection of stocks under both investment strategies with analysts’ forecast recommendations. The findings show that value and contrarian investment strategies essentially select different stocks at any given point in time. Moreover, the study finds that both investment strategies can work in the same form of market efficiency. This study brings new insights to scholars, analysts, and investors for analyzing investment strategies and their portfolio composition. Full article
(This article belongs to the Special Issue Recent Research on Behavioral and Experimental Finance)
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