THE DIFFERENCES AND SIMILARITIES BETWEEN TRADITIONAL FINANCE AND BEHAVIORAL FINANCE

This research paper examines the differences and similarities between traditional finance and behavioral finance. Traditional finance, rooted in rational decision-making and efficient markets, has long been the dominant framework in finance. However, behavioral finance challenges this paradigm by incorporating insights from psychology and behavioral economics, recognizing that human behavior often deviates from rationality. The paper provides an overview of both approaches, explores their key differences and similarities, and discusses their implications for understanding financial decision-making and market outcomes. Through a comprehensive analysis of relevant literature and empirical studies, this research paper aims to shed light on the contrasting perspectives and the potential integration of traditional and behavioral finance