Chartered Accountant,	Cost & Works Acct , Passed CISA and CISSP, BA Eco(Hons) St Stephens College, ISC St Columba's School, Delhi

Rakesh Sud

The Course is on Financial Accounting: Impact of Behavioral Sciences.Behavioral Finance is the area of research that attempts to understand and explain how reasoning errors influence investor decisions and market prices.Much of behavioral finance research stems from the research in the area of cognitive psychology.

Choose from the various concepts taught in a comprehensible way for students looking to strengthen their CA preparation.

CA Foundation

English

Financial Accounting - Impact of Behavioural Sciences

CA (Chartered Accountancy) Preparation

Personal Finance

Types of Financing

Strategic Financial Management

Final Group 1 - Old Syllabus

CA, CS, and CMA

Ace the toughest competitive and government exams in India 

Test Preparation

Financial Accounting: Impact of Behavioral Sciences - Introduction. Behavioral Finance promises to make economic models better at explaining systematic (non-idiosyncratic)  investor decisions, taking into consideration their emotions and cognitive errors and how these influence decision making.
Behavioral Finance is not a branch of standard finance; it is its replacement, offering a better model of humanity.

Impact of Behavioural Sciences - Introduction

Financial Accounting: Impact of Behavioural Sciences – What is Behavioural Science. Behavioural Finance provides an ‘overlay’ to the Standard Theory.Theory It provides a framework to understand ‘non-rational’ investor and market behaviours. Investors Are not totally rational, Often act based on imperfect information and Make “non-rational” decisions in predictable ways

What is Behavioural Science

Financial Accounting: Impact of Behavioural Sciences – Standard Theories of Finance. Investors Are rational beings,Consider all information and accurately assess its meaning. Some individuals/agents may behave irrationally or against predictions, but in the aggregate they become irrelevant.Markets Quickly incorporate all known information and Represent the true value of all securities.

Standard Theories of Finance

Financial Accounting: Impact of Behavioural Sciences – Narrow framing.Investing is a series of “propositions,” not a single event. Performance should always be viewed within the context of your total net worth (as opposed to individual investments). Look at long-term goals, not short-term results

Narrow Framing

Financial Accounting: Impact of Behavioral Sciences - Anchoring. Anchors affect an investor’s frame of reference. We must Be aware of investment anchors, Use relevant benchmarks in comparing your investment  portfolio and Be cognizant of long-term goals, not short-term fluctuations.

What is Anchoring?

Financial Accounting: Impact of Behavioural Sciences – Regret. Physiological and emotional pain associated with Loss Aversion and Regret.Excessive conservatism associated with Narrow Framing and Mental Accounting.Loss of confidence caused by Media Response, Herding and Anchoring.Optimism minimizes the roles of uncertainty and chance in investing.

Loss Aversion and Regret

Financial Accounting: Impact of Behavioural Sciences - Behavioral Finance and the Psychology of Investing. Psych yourself up and get a good understanding of prospect theory, The implications of investor overconfidence and misperceptions of randomness, Sentiment-based risk and limits to arbitrage and The wide array of technical analysis methods used by investors.

Behavioural Finance and the Psychology of Investing

Financial Accounting: Impact of Behavioural Sciences – Mental Accounting etc Mental Accounting, Behaviors etc: Associating a stock with its purchase price.If you are engaging in mental accounting You find it is difficult to sell a stock at a price lower than your purchase price. If you sell a stock at a loss It may be hard for you to think that purchasing the stock in the first place was correct.You may feel this way even if the decision to buy was actually a very good decision.A further complication of mental accounting is loss aversion

Mental Accounting

Financial Accounting: Impact of Behavioural Sciences – Overconfidence. Investors tend to invest too heavily in shares of the company for which they work.This loyalty can be very bad financially.Your earning power (income) depends on this company. Your retirement nest-egg also depends on this company. Another examples of the lack of diversification is investing too heavily in the stocks of local companies

Overconfidence in Financial Accounting

Financial Accounting: Impact of Behavioural Sciences – Charting. Technical analysts rely heavily on charts that show recent market prices.Technical analysis is sometimes called “charting.”Technical analysts are often called “chartists.”Chartists study graphs (or charts) of past market prices (or other information).

Charting: Graphs and Market Study

Precursor and Ongoing Developments

Financial Accounting: Impact of Behavioural Sciences – Explanations/Theories for Under and Over reaction. Investor Overconfidence and biased self attribution. Variations in investor confidence which is an over estimation of ability to value stocks and predict future prices arising from biased self attribution 
which is confirming information in the public arena encourages but disconfirming information does not discourage, (blames others) leads to market over and under reaction to information.

Explanations/Theories for Under and Over Reaction

Financial Accounting: Impact of Behavioural Sciences – Efficient Market Hypothesis etc, “The market price at any time instant reflects all available information in the market”. We cannot “make money” using “stale information”.Three forms are as under, weak form: past prices and returns.Semi-strong form: all public information.
Strong form: all public AND private information. There is no other proposition in economics which has more empirical support than the EMH.

Efficient Market Hypothesis

Financial Accounting: Impact of Behavioural Sciences – Prospect Theory.Limits to Arbitrage. Behavioral biases would not matter for stock pricing if rational arbitrageurs could fully exploit the mistakes of behavioral investors. (a claim of traditional finance). Behaviorisms, in practice several factors limit the ability to profit from mispricing (Fundamental risk, Implementation costs, Model risk)

Impact of Behavioural Sciences – Prospect Theory

This course is provides an introduction to capital markets. It is Ideally suited for students who want to pursue areers in Capital Markets. Someone who wants to understand the basics of Capital Markets will find this Course a one-stop-shop to start their journey of learning. Tags: Capital Market, Global Capital Market, Indian Capital Market, Buyers and Sellers, Secondary Markets

Understanding Capital Markets for Beginners

done graduation at khalsa college 
my aim to become a successful person
my main motive is to spread knowledge everywhere and to became every

Sukhpreet Kaur

In this course, the educator discusses the Financial services, lease financing, factoring, retail banking services, and venture capital which is helpful for CA aspirants.

(Hindi) Financial Services: CA Exams

Uma Venkateswar Rao Dosapati

It describes the various provisions related to Valuation and Rules prescribed thereunder

Principles of Interpretation and Valuation of Services

Company Secretary by profession
teaching being a passion 
endeavour to spread best of my knowledge  

Isha Jain

The course discusses Corporate Restructuring and different concepts under it.

(Hindi) Corporate Restructuring - CA Exams

I am Jatinder kaur. working as an assistant professor in baba farid group of institution, bathinda. I have done my masters in commerce from 

Jatinder Kaur

This course contain the detailed concept of Joint venture.What are the different methods of  maintaining books of joint venture with easy explanation.

Lessons

14 lessons • 1h 59m

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Impact of Behavioural Sciences - Introduction

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What is Behavioural Science

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Standard Theories of Finance

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Narrow Framing

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What is Anchoring?

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Loss Aversion and Regret

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Behavioural Finance and the Psychology of Investing

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Mental Accounting

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Overconfidence in Financial Accounting

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Charting: Graphs and Market Study

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