Woolly thoughts (blog)
In this blog we publish our thoughts on political and social developments that complement our market analyses with timely assessments and provide background information on behavioral finance and sentiment analysis.
Behavioral Finance: Understanding the Psychology Behind Financial Decision-Making
24 August 2023
In the realm of traditional finance, economic theories often assume that investors are rational, utility-maximizing individuals who make decisions based on all available information. However, in reality, human behavior is far more complex and often deviates from these rational models. This realization has given rise to a field known as behavioral finance, which seeks to understand the psychological factors that influence financial decision-making and the subsequent impact on markets and economic outcomes.
