Market Minds: Understanding Behavioral Finance Concepts

Abstract

The topic of behavioural finance is challenging the traditional notion of rational decision-making in the ever-changing financial markets. This paradigm shift examines the interaction between psychology, cognitive biases, and financial decisions, offering insights into market anomalies and behaviours that contradict conventional economic theory. Behavioural finance is an interdisciplinary field that combines psychology, cognitive science, economics, and finance. Its purpose is to connect economic theory with actual financial behaviours seen in the real world.