BEHAVIORAL FINANCE TRAINING COURSES
Essentials of Behavioral Finance
This course delves into the effects of psychological biases on financial markets and decision-making. Participants will understand the impact of investor psychology on market trends and explore real-world examples of common biases.
The program covers the role of these biases in the client-advisor dynamic, portfolio construction, financial forecasts, and corporate governance. Attendees will gain tools to identify and
mitigate biases, enhancing decision quality and organizational performance.
Ref: EBF-225
Learning Outcomes
- Understand the contribution of behavioral finance to classic financial theory.
- Grasp the behavior of financial markets in light of behavioral finance.
- Understand investor behavior through behavioral finance.
- Identify and analyze the impact of behavioral finance on the client-advisor relationship.
- Understand how behavioral biases affect portfolio construction.
- Realize how behavioral biases influence financial analysts' forecasts.
- Understand how psychological biases affect the interpretation of accounts presented at meetings.
- Identify the link between behavioral finance and corporate governance.
Who Should Attend
- Fund Manager
- Portfolio Manager
- Wealth Manager
- Financial Analyst
- Members of an Investment or Credit Committee
- Any individual wishing to know and identify their behavioral biases to improve their investment choices.
Duration
- 2 days or 14 hours
Price
- €2250 + VAT for one participant.
- €1800 + VAT each for a group of 2 or 3 participants, only with group registration.
- €1450 + VAT each for groups of more than 3, only with group registration.
Tailored Training Solutions
- We offer the option to collaboratively develop customized programs.
- If you don't find precisely what you're looking for, we are here to assist you in constructing the perfect solution for your organization.
- Any of our training courses can be delivered just for your team.
- We can also co-create bespoke programmes, so if you can't find exactly what you need, we can help you build the right solution for your organisation.
Training Agenda
I. Definition, Disruption, and Contribution of Behavioral Finance
- Behavioral finance vs market efficiency theory
- Definition and characteristics of cognitive biases
- Definition and characteristics of emotional biases
- Definition and characteristics of social biases
- Practical Case :
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- Identifying the nature of a biases based on a given scenario.
II. Behavioral Finance and Market Behavior
- Market anomalies
- Momentum, anchoring bias, availability bias, disposition bias
- Bubbles: overconfidence bias, regret aversion bias, hindsight bias, self-serving bias, representativeness bias
- Crashes: anchoring bias, disposition bias, representativeness bias
- Value vs Growth: the "value" anomaly, halo effect
- Quiz:
III. Behavioral Finance and Investor Behavior
- Biases affecting the decision-making of individual investors
- Biases affecting the decision-making of institutional investors
- Approaches to mitigate or correct these biases for both individual and institutional investors
- Practical Case :
-
- Identification and analysis of biases and proposal of solutions based on a given situation.
IV. Impact of Behavioral Finance in the Client vs Advisor Relationship
- Understanding client objectives, identifying client objectives, identifying risk tolerance based on the client's behavioral biases
- Following a systematic management approach
- Accounting for changes in the client's situation and risk tolerance
- Quiz:
-
- Identifying specific biases in a proposed scenario.
V. How Behavioral Biases Affect Portfolio Construction
- Naive diversification
- Familiarity bias
- Representation bias
- Status-quo bias
- Home bias
- Quiz:
-
- Identifying specific biases in a proposed scenario.
VI. How Behavioral Biases Affect Financial Analysts' Forecasts
- Overconfidence, illusion of knowledge, hindsight bias, representativeness bias, availability bias, self-serving bias
- Corrective actions
- Practical Case:
-
- Identification and analysis of biases and proposal of solutions based on a given situation.
VII. How Behavioral Biases affect Financial Statements Analysis
- Anchoring and adjustment bias
- Representation bias
- Availability bias
- Self-serving bias
- Corrective actions
- Practical Case:
-
- Identification and analysis of biases and proposal of solutions based on a given situation.
VIII. Behavioral Finance and Governance
- Biases affecting the decisions of the investment committee: characteristics specific to a committee as a group, social proof bias
- Corrective actions: diversifying the group based on social and cultural origins, skills, impartiality and objectivity of the committee head, promoting free speech, having one of the committee members play the "devil's advocate" role
- Practical Case :
-
- Identification and analysis of biases and proposal of solutions based on a given situation.