New book has been released
Publishing House Virtus Interpress is honored to announce a release of a new book titled “Behavioral finance and wealth management: Market anomalies, investors’ behavior and the role of financial advisors” authored by Enrico Maria Cervellati, Natascia Angelini, and Gian Paolo Stella.
This book presents an examination of the intricate relationship between human behavior and financial decision-making, with particular regard to wealth management. It consists of three chapters.
The first chapter is dedicated to the behavioral foundations, delving into the origin and progression of behavioral economics and finance, it explores cognitive and emotional biases such as confirmation bias, hindsight bias, the illusion of knowledge and the illusion of control, overoptimism, and overconfidence, as well as status quo bias.
The second chapter proposes key market anomalies and individual investors’ behaviors. Among market anomalies, we consider calendar or seasonal anomalies, cross-section anomalies, event-based anomalies, momentum, and reversal. The chapter includes a section on evidence from Italy, discussing overconfidence in trading and attention-grabbing behaviors.
The third chapter focuses on the links between behavioral finance and wealth management. It discusses motivational theory, the pitfalls of naive diversification, and the biased perception of risk-reward ratios. Behavioral portfolio theory, mental accounting in the context of investment pyramids, and behavioral goals-based wealth management are explored. The chapter examines behavioral profiling beyond risk tolerance, addressing aspects like overconfidence, the role of luck and competence, and the importance of trust and life satisfaction in financial decision-making.
By dissecting biases, market anomalies, and investors’ behaviors, the book provides valuable insights for investors, financial advisors, and anyone interested in the intersection of behavioral finance and wealth management.
The book “Behavioral finance and wealth management: Market anomalies, investors’ behavior and the role of financial advisors” is an Open Access book, you can find detailed information about the book, read and download it here.
