This chapter provides a critical review of behavioral economic approaches to decision-making with a focus on the thinking processes of investors. It discusses the bounded rationality approach to decision-making as compared to the errors and biases approach for better understanding...

By applying the concept of “information ratio” to data published in The 2014 Berkshire Hathaway's Annual Report, this work discuss with quantitative data and equations Warren Buffett's management strategy and financial accomplishment at Berkshire Hathaway. Furthermore, a combined analysis of...

Understanding fundamental human tendencies can help financial planners and advisers recognize behaviors that may interfere with clients achieving their long-term goals. The authors describe several well-established behavioral biases and suggest how to overcome them

On paper, momentum is one of the most compelling factors: simulated portfolios based on momentum add remarkable value, in most time periods and in most asset classes, all over the world. So, our title may seem unduly provocative. However, live results for mutual funds that take on a momentum...

I provide evidence that investor size matters in the market for short-term securities. Between January 2011 and November 2020, the largest asset management families obtained significantly higher promised returns from their money market securities than smaller families. Furthermore, I show that...

Fairness matters to financial advisors, whether fairness in financial markets or fairness in their relations with clients. Yet perceptions of fairness vary greatly and they are hotly debated everywhere, including politics, education, medicine, law, and finance. I explore fairness in finance in...