fin5bef behavioural finance
BEHAVIOURAL FINANCE
FIN5BEF
2019
Credit points: 15
Subject outline
In this subject you will learn about the behavioural biases, heuristics and framing effects that present obstacles to maximising the value derived from financial and investment decisions. In other words, Behavioural Finance examines how individual financial decision making and behaviour affect outcomes in financial markets. This will include examination of the trading and investment behaviours of various types of investors, including individual and institutional investors, and in various market settings, with predominant focus on equity investment and trading markets.
SchoolLa Trobe Business School
Credit points15
Subject Co-ordinatorPetko Kalev
Available to Study Abroad StudentsYes
Subject year levelYear Level 5 - Masters
Exchange StudentsYes
Subject particulars
Subject rules
PrerequisitesN/A
Co-requisitesN/A
Incompatible subjectsN/A
Equivalent subjectsN/A
Special conditionsN/A
Learning resources
Readings
| Resource Type | Title | Resource Requirement | Author and Year | Publisher |
|---|---|---|---|---|
| Readings | The Psychology of Investing, 5th edn | Prescribed | Nofsinger, John R, 2014 | Pearson Education, New Jersey |
| Readings | Selected published papers for the seminars (avail.through LMS) | Prescribed | various | various |
Graduate capabilities & intended learning outcomes
01. Critically identify the behavioural biases, heuristics and framing effects that present obstacles to maximising the value derived from corporate financial and investment decisions.
- Activities:
- Seminars will cover key concepts to be applied in the individual assignment and group presentation
- Related graduate capabilities and elements:
- Literacies and Communication Skills(Writing,Speaking)
- Literacies and Communication Skills(Writing,Speaking)
- Inquiry and Analytical Skills(Critical Thinking,Inquiry/Research)
- Personal and Professional Skills(Teamwork including leadership and working in groups)
- Discipline -Specific Knowledge and Skills(Discipline-Specific Knowledge and Skills)
02. Critically assess and analyse how individual financial decision making and behaviour affect investment outcomes in financial markets.
- Activities:
- Seminars will cover key concepts to be applied in individual continuous assessment tasks and the final examination
- Related graduate capabilities and elements:
- Literacies and Communication Skills(Writing,Speaking)
- Literacies and Communication Skills(Writing,Speaking)
- Inquiry and Analytical Skills(Critical Thinking,Inquiry/Research)
- Discipline -Specific Knowledge and Skills(Discipline-Specific Knowledge and Skills)
03. Critically highlight the relevant issues that arise in comparisons between efficient ('economically rational') markets and less understood but more realistic behavioural ('partially rational' or 'irrational') markets.
- Activities:
- Seminars will cover key concepts to be applied in individual continuous assessment tasks and the final examination
- Related graduate capabilities and elements:
- Literacies and Communication Skills(Writing,Speaking)
- Inquiry and Analytical Skills(Critical Thinking,Inquiry/Research)
- Inquiry and Analytical Skills(Critical Thinking,Inquiry/Research)
- Discipline -Specific Knowledge and Skills(Discipline-Specific Knowledge and Skills)
04. Demonstrate how educated investors and corporate decision makers can overcome these behavioural biases, heuristics and framing effects to improve their corporate financial and investment decisions.
- Activities:
- Seminars will cover key concepts to be applied in the final examination
- Related graduate capabilities and elements:
- Literacies and Communication Skills(Writing,Speaking)
- Inquiry and Analytical Skills(Critical Thinking,Inquiry/Research)
- Inquiry and Analytical Skills(Critical Thinking,Inquiry/Research)
- Discipline -Specific Knowledge and Skills(Discipline-Specific Knowledge and Skills)
Subject options
Select to view your study options…
Melbourne, 2019, Semester 1, Day
Overview
Online enrolmentYes
Maximum enrolment sizeN/A
Enrolment information
Subject Instance Co-ordinatorPetko Kalev
Class requirements
Block ModeWeek: 11 - 18
Six 6.0 hours block mode per study period on weekends during the day from week 11 to week 18 and delivered via face-to-face.
"Delivered on Saturday and Sunday on the following dates: 16 & 17 March, 30 and 31 March, and 4 and 5 May."
Assessments
| Assessment element | Comments | % | ILO* |
|---|---|---|---|
| Group Assignment and Group Presentation | Written (20%), Presentation (10%) Total equivalent to 2000 words per student | 30 | 01 |
| Individual Continuous Assessment, equivalent to 1,500 words per student | This will include various activities, including analysis of market trading activity and outcomes, reporting and interpreting empirical research results from academic papers, and critiques / reviews of academic papers. | 20 | 02, 03, 04 |
| 3-hour final examination (equivalent to 3000 words) | Comprise a mix of short-answer analytical, problem-solving and interpretative questions. | 50 | 03, 04 |