Behavioral Finance and Investment Decision Making: A Study of Investor Biases and the Impact

Abstract

The interesting topic of investor biases and how they affect portfolio performance, is being studied in this dissertation. Utilizing information from top financial information sources such as FactSet, Thomson Reuters Eikon, and Bloomberg, we are able to examine past investor behaviour and market trends. For example, Bloomberg terminal data can show how investor sentiment varies over time towards different industries during volatile market times. Eikon tracks coexisted buying and selling activity across various investment groups, providing huge insights into groupthink. This study can evaluate the effects of particular biases on performance, such as overconfidence that results in excessive risk concentration.