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Rational route to investment returns

[Sponsored Article] Think you make considered and rational choices when it comes to your investments? Well even the members of a financially knowledgeable audience were given pause for thought when Professor Utpal Bhattacharya and Professor Philip Cheng from HKUST’s Department of Finance shared their research findings and ideas at the first of the Business School’s Lunch Presentation Series 2018.

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HKUST Business School shares insights into financial behavior and portfolio management in its BizInsight@HKUST Presentation Series. The talk was moderated by Prof Chu Zhang (middle), Acting Head of Department of Finance.

[Sponsored Article]

Think you make considered and rational choices when it comes to your investments? Well even the members of a financially knowledgeable audience were given pause for thought when Professor Utpal Bhattacharya and Professor Philip Cheng from HKUST’s Department of Finance shared their research findings and ideas at the first of the Business School’s Lunch Presentation Series 2018.

Their always fascinating, and frequently amusing, lunchtime seminar was titled ‘How different factors affect financial behavior and portfolio management’. While Professor Bhattacharya pointed out some of the psychological pitfalls to avoid when investing, Professor Cheng outlined a more reliable and profitable strategy than those usually used by private investors.

“Anchoring describes the common human tendency to reply excessively on the first piece of information – the anchor – when making decisions” said Prof Utpal Bhattacharya
“Anchoring describes the common human tendency to reply excessively on the first piece of information – the anchor – when making decisions” said Prof Utpal Bhattacharya

Psychology and Finance

Behavioral finance specialist Professor Bhattacharya is a non-believer when it comes to the notion of rational finance. Instead he takes insights from cognitive psychology to explain puzzling asset price fluctuations. In his talk, he illustrated his ideas through three examples from his research.

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