Write a 250-word response to the following. Make a recommendation to your classmate of a peer-reviewed journal article that provides additional information on their topic.
In your response, you should give a summary of the article in your own words and discuss why it is relevant to their forum topic. It must be different from than articles they reference in their forum. Include an APA formatted citation at the bottom of the reply.
Discussion Response
Behavioral Finance
Behavioral finance entails studying how psychology influences affect investors and financial markets. According to Zahera and Bansal (2018), biases in behavioral finance may lead individuals to make detrimental and illogical decisions. Thus, an understanding of behavioral finance helps individuals make rational moves regarding their finance. In this view, the main focus of this discussion is investor data and behavior. The topic is crucial in determining the behaviors that can hinder investors from reaching their financial goals. Prior research focuses on the changes in the market, which create forces affecting the decision-making process of the investors.
However, the current research shows that financial behavior is significantly affected by the demographic characteristics of individuals.
The current research has shown a significant inclination towards the demographic characteristics of individuals. For instance, the study by De Bortoli et al. (2019) aimed to determine the risk profile manifestation by investors. The article explains the influence of personality traits on the behavior of economic agents. Another study by Gutiérrez-Roig (2019) indicates that the lack of data regarding financial markets can limit success.
Additionally, Jokar and Daneshi (2018) suggest that the emotional aspect of the investors has a significant impact on the stock returns. Karsh (2018) argues that the lack of information and education regarding financial situations can lead to the inability to make sound financial choices.
Also, the article by Zahera and Bansal (2018) focuses on the biases caused in investment decision-making. Hence, it is crucial to study the financial data and the behavioral issues of the investors. Thus, the question to explore is, what should investors do to increase their financial knowledge and behavior on investments?
