The book that applies behavioral finance to the real world Understanding how to use behavioral finance theory in investing is a hot topic these days. Nobel laureate Daniel Kahneman has described financial advising as a prescriptive activity whose main objective should be to guide investors to make decisions that serve their best interests. The reality? Thata²s easier said than done. In the Second Edition of Behavioral Finance and Wealth Management, Michael Pompian takes a practical approach to the growing science of behavioral finance, and puts it to use for real investors. He applies knowledge of 20 of the most prominent individual investor biases into qbehaviorallyamodifiedq asset allocation decisions. Offering investors and financial advisors a qselfahelpq book, Pompian shows how to create investment strategies that leverage the latest cutting edge research into behavioral biases of individual investors. This book: Shows investors and financial advisors how to either moderate or adapt to behavioral biases, in order to improve investment results and identifies qthe best practical allocationq for investment portfolios. Using these two sound approaches for guiding investment decisionamaking, behavioral biases are incorporated into the portfolio management process Uses updated cases studies to show investors and financial advisors how an investora²s behavior can be modified to improve investment decisionamaking Provides useable methods for creating behaviorally modified investment portfolios, which may help investors to reach their long term financial goals Heightens awareness of biases so that financial decisions and resulting economic outcomes are improved Offers advice on managing the effects of each bias in order to improve investment results This Second Edition illustrates investorsa² behavioral biases in detail and offers financial advisors and their clients practical advice about how to apply the science of behavioral finance to improve overall investment decision making.This book: Shows investors and financial advisors how to either moderate or adapt to behavioral biases, in order to improve investment results and identifies aquot;the best practical allocationaquot; for investment portfolios.
|Title||:||Behavioral Finance and Wealth Management|
|Author||:||Michael M. Pompian|
|Publisher||:||John Wiley & Sons - 2012-01-03|