Prospect Theory and the Financial Markets: A Review
Philippine Journals Online
View Archive Info| Field | Value | |
| Title |
Prospect Theory and the Financial Markets: A Review
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| Creator |
Paulo Jose M Mutuc; De La Salle University
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| Subject |
Economics
Financial analysis; financial market; investment |
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| Description |
The Prospect Theory as proposed by Kahneman and Tversky (1979) has emerged as awidely accepted theory of decision-making, thanks largely to the persistence of observedanomalies in the trading of financial products – specifically, the existence of an unusually largepremium on equities, and the tendency to hold on to losing investments (disposition effect).Questions about the true nature and extent of reference-dependent loss aversion as manifestedby these phenomena, however, remain. In particular, for countries like the Philippines withrelatively shallow capital markets, there is a need to reconcile financial education and advicewith the reality of systematically irrational investor sentiment to facilitate greater financialmarket participation.Keywords: Financial analysis; financial market; investmentDOI: 10.3860/ber.v20i1.1670DLSU Business & Economics Review 20.1 (2010), pp. 99-106
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| Publisher |
De La Salle University
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| Contributor |
—
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| Date |
2010-07-26
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| Type |
Peer-reviewd Article
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| Format |
application/pdf
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| Identifier |
http://www.philjol.info/index.php/BER/article/view/1670
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| Source |
DLSU Business & Economics Review; Vol 20, No 1 (2010); 99-106
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| Language |
en
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| Coverage |
Philippines
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