The Dynamics of Behavioral Finance

Behavioral finance basically addresses the influence of psychology on investment decision-making. It's difficult to expect the same behavior from all the investors in their investment decision-making process, which might have made the academicians, industry experts, and market participants focus on the study on the field of behavioral finance. Many psychological factors may influence an investor's decision making such as emotions, personality, society, government policies, and economy. The literature acknowledges that the field of behavioral finance mainly emphasizes on identifying heuristics and biases of individuals in making financial decisions