Friday, October 01, 2010

IIM-Calcutta students get into the mind of investors

IIM Calcutta students are now studying psychological concepts to better understand investor behaviour and the financial implications of such behaviour. In a novel course introduced this year called Behavioural Finance taught by Prof. Avanidhar Subrahmanyam, the Goldyne and Irwin Hearsh Chair in Finance from UCLA Anderson School of Management, the students, by means of interactive dialogue, learn about different aspects of investor behaviour, the rationale, or lack thereof, behind such behaviour and ways to forecast them.

Classical finance assumes all investors to be rational and thus, fails to explain events like market crashes, unprecedented booms or volatility. Behavioural finance, on the other hand, proposes psychology-based theories to explain anomalies in the market.

The course gives the students an insight into the world of irrational investors, and through interactive dialogue, helps students assess what investors would do in various situations, as humans and not as calculators. Nitin Pahwa, a student who took the course, said: "The course material comprised a set of recent research papers in the field and the discussions in the class were of immense value."

Source: The Economic Times, October 1, 2010
IIM-Calcutta students get into the mind of investorsSocialTwist Tell-a-Friend

No comments:

Post a Comment

Blog Archive