Download or read book Risk Profiling through a Behavioral Finance Lens written by Michael Pompian and published by CFA Institute Research Foundation. This book was released on 2016-03-03 with total page 58 pages. Available in PDF, EPUB and Kindle. Book excerpt: This piece examines risk profiling through a behavioral finance lens. Behavioral finance attempts to understand and explain actual investor behavior, in contrast to theorizing about investor behavior. It differs from traditional (or standard) finance, which is based on assumptions of how investors and markets should behave. Much has been written about the tension that exists between the willingness to take risk and the ability to take risk. Risk appetite is the willingness to take risk and risk capacity is the ability to take risk. In the behavioral context, risk appetite and risk capacity are defined in terms of known risks and unknown risks. Irrational client behavior often occurs when a client experiences unknown risks. To aid in the advisory process, advisors can use Behavioral Investor Types to help make rapid yet insightful assessments of what type of investor they are dealing with before recommending an investment plan. With a better understanding of behavioral finance vis-à-vis risk taking, practitioners can enhance their understanding of client preferences and better inform their recommendations of investment strategies and products.

Download or read book Portfolio Management for Financial Advisors written by Prince Sarpong and published by Centre for financial Planning Studies. This book was released on 2024-01-22 with total page 319 pages. Available in PDF, EPUB and Kindle. Book excerpt: Volume 2 of Portfolio Management for Financial Advisors is a visionary exploration into the evolving landscape of managing client portfolios in financial planning. Being more than a sequel, this book challenges the financial planning profession to aspire for profound impact. Beyond foundational concepts, the author blends professional experience with academic rigour to provide a unique lens on managing client portfolios. Among other topics, the book delves into practical tools for portfolio risk management, retirement portfolio management, and boldly asserts the profession's potential to address global challenges.

Download or read book Risk Profiling and Tolerance Insights for the Private Wealth Manager written by Joachim Klement and published by CFA Institute Research Foundation. This book was released on 2018-05-01 with total page 150 pages. Available in PDF, EPUB and Kindle. Book excerpt: If risk aversion and willingness to take on risk are driven by emotions and we as humans are bad at correctly identifying them, the finance profession has a serious challenge at hand—how to reliably identify the individual risk profile of a retail investor or high-net-worth individual. In this series of CFA Institute Research Foundation briefs, we have asked academics and practitioners to summarize the current state of knowledge about risk profiling in different key areas.

Download or read book The Smart Financial Advisor written by Bill Martin CFA and published by Harriman House Limited. This book was released on 2017-10-25 with total page 207 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Research Foundation Review 2018 written by CFA Institute Research Foundation and published by CFA Institute Research Foundation. This book was released on 2019-04-19 with total page 142 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Research Foundation Review 2018 summarizes the offerings from the CFA Institute Research Foundation over the past year—books, literature reviews, workshop presentations, and other relevant material.

Download or read book Investment Governance for Fiduciaries written by Michael E. Drew and published by CFA Institute Research Foundation. This book was released on 2019-04-22 with total page 142 pages. Available in PDF, EPUB and Kindle. Book excerpt: Governance is a word that is increasingly heard and read in modern times, be it corporate governance, global governance, or investment governance. Investment governance, the central concern of this modest volume, refers to the effective employment of resources—people, policies, processes, and systems—by an individual or governing body (the fiduciary or agent) seeking to fulfil their fiduciary duty to a principal (or beneficiary) in addressing an underlying investment challenge. Effective investment governance is an enabler of good stewardship, and for this reason it should, in our view, be of interest to all fiduciaries, no matter the size of the pool of assets or the nature of the beneficiaries. To emphasize the importance of effective investment governance and to demonstrate its flexibility across organization type, we consider our investment governance process within three contexts: defined contribution (DC) plans, defined benefit (DB) plans, and endowments and foundations (E&Fs). Since the financial crisis of 2007–2008, the financial sector’s place in the economy and its methods and ethics have (rightly, in many cases) been under scrutiny. Coupled with this theme, the task of investment governance is of increasing importance due to the sheer weight of money, the retirement savings gap, demographic trends, regulation and activism, and rising standards of behavior based on higher expectations from those fiduciaries serve. These trends are at the same time related and self-reinforcing. Having explored the why of investment governance, we dedicate the remainder of the book to the question of how to bring it to bear as an essential component of good fiduciary practice. At this point, the reader might expect investment professionals to launch into a discussion about an investment process focused on the best way to capture returns. We resist this temptation. Instead, we contend that achieving outcomes on behalf of beneficiaries is as much about managing risks as it is about capturing returns—and we mean “risks” broadly construed, not just fluctuations in asset values.

Download or read book Research Foundation Review 2016 written by and published by CFA Institute Research Foundation. This book was released on 2017 with total page 162 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Research Foundation Review 2016 summarizes the offerings from the CFA Institute Research Foundation over the past year—monographs, literature reviews, workshop presentations, and other relevant material.

Download or read book Understanding the Investor written by Antonietta Bonello and published by Emerald Group Publishing. This book was released on 2019-06-19 with total page 273 pages. Available in PDF, EPUB and Kindle. Book excerpt: In finance, understanding investors and their motivations is key for any business and policy-maker. Understanding the Investor: A Maltese Study of Risk and Behavior in Financial Investment Decisions offers a nuanced view of the Maltese investor and the Malta Stock Exchange, and its implications on the wider financial world.

Download or read book Handbook of Research on Decision Making Techniques in Financial Marketing written by Dinçer, Hasan and published by IGI Global. This book was released on 2019-12-27 with total page 646 pages. Available in PDF, EPUB and Kindle. Book excerpt: Consumer needs and demands are constantly changing. Because of this, marketing science and finance have their own concepts and theoretical backgrounds for evaluating consumer-related challenges. However, examining the function of finance with a marketing discipline can help to better understand internal management processes and compete in today’s market. The Handbook of Research on Decision-Making Techniques in Financial Marketing is a collection of innovative research that integrates financial and marketing functions to make better sense of the workplace environment and business-related challenges. Different financial challenges are taken into consideration while many of them are based on marketing theories such as agency theory, product life cycle, and optimal consumer experience. While highlighting topics including behavioral financing, corporate ethics, and Islamic banking, this book is ideally designed for financiers, marketers, financial analysts, marketing strategists, researchers, policymakers, government officials, academicians, students, and industry professionals.

Download or read book Research Foundation Review 2017 written by CFA Institute Research Foundation and published by CFA Institute Research Foundation. This book was released on 2018 with total page 126 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Research Foundation Review 2017 summarizes the offerings from the CFA Institute Research Foundation over the past year—books, literature reviews, workshop presentations, and other relevant material.

Download or read book Financial Risk Tolerance A Psychometric Review written by John E. Grable and published by CFA Institute Research Foundation. This book was released on 2017-06-30 with total page 27 pages. Available in PDF, EPUB and Kindle. Book excerpt: This content provides financial analysts, investment professionals, and financial planners with a review of how financial risk-tolerance tests can and should be evaluated. It begins by clarifying terms related to risk taking and is followed by a broad overview of two important measurement terms: validity and reliability. It concludes with examples for practice.

Download or read book Behavioral Finance The Coming Of Age written by Itzhak Venezia and published by World Scientific. This book was released on 2019-04-18 with total page 501 pages. Available in PDF, EPUB and Kindle. Book excerpt: The area of behavioral finance, though relatively young, has matured and spread beyond its initial objectives: to demonstrate the fallibility of the efficient market hypothesis, to shake the belief in the ubiquity of rational decision making, and to convince the finance world of the importance of psychological biases in decision making. The success of the field in meeting its goals, however, has called into question its continued relevance. Behavioral finance is thus currently at a crossroads, and researchers need to decide which way they should turn for the area to continue to thrive and to meaningfully contribute to financial knowledge.This collection of papers deals with rarely-explored topics to point at new directions that behavioral finance should explore to maintain its viability, along with contributions to traditional topics. Some of these topics include innovations, the psychology of policy-makers, biases of peer-to-peer market participants, the behavior and motivation behind corporate social responsibility, and the design of exchanges. Additionally, well-known topics such as the disposition effect, slow and fast decisions and the availability heuristic are revisited, and surprising new findings are presented.By opening the field to novel avenues of discussion, this book addresses the future of behavioral finance and its transition into a new era.

Download or read book Goals Based Portfolio Theory written by Franklin J. Parker and published by John Wiley & Sons. This book was released on 2022-12-08 with total page 262 pages. Available in PDF, EPUB and Kindle. Book excerpt: An in-depth overview of investing in the real world In Goals-Based Portfolio Theory, award-winning Chartered Financial Analyst® Franklin J. Parker delivers an insightful and eye-opening discussion of how real people can navigate the financial jungle and achieve their financial goals. The book accepts the reality that the typical investor has specific funding requirements within specified periods of time and a limited amount of wealth to dedicate to those objectives. It then works within those limits to show you how to build an investment portfolio that maximizes the possibility you’ll achieve your goals, as well as how to manage the tradeoffs between your goals. In the book, you’ll find: Strategies for incorporating taxation and rebalancing into a goals-based portfolio A discussion of the major non-financial risks faced by people engaged in private wealth management An incisive prediction of what the future of wealth management and investment management may look like An indispensable exploration of investing as it actually works in the real world for real people, Goals-Based Portfolio Theory belongs in the library of all investors and their advisors who want to maximize the chances of meeting financial goals.

Download or read book Behavioral Finance and Capital Markets written by A. Szyszka and published by Springer. This book was released on 2013-09-04 with total page 417 pages. Available in PDF, EPUB and Kindle. Book excerpt: Behavioral Finance helps investors understand unusual asset prices and empirical observations originating out of capital markets. At its core, this field of study aids investors in navigating complex psychological trappings in market behavior and making smarter investment decisions. Behavioral Finance and Capital Markets reveals the main foundations underpinning neoclassical capital market and asset pricing theory, as filtered through the lens of behavioral finance. Szyszka presents and classifies many of the dynamic arguments being made in the current literature on the topic through the use of a new, ground-breaking methodology termed: the General Behavioral Asset Pricing Model (GBM). GBM describes how asset prices are influenced by various behavioral heuristics and how these prices deviate from fundamental values due to irrational behavior on the part of investors. The connection between psychological factors responsible for irrational behavior and market pricing anomalies is featured extensively throughout the text. Alternative explanations for various theoretical and empirical market puzzles - such as the 2008 U.S. financial crisis - are also discussed in a convincing and interesting manner. The book also provides interesting insights into behavioral aspects of corporate finance.

Download or read book Portfolio Theory and Management written by H. Kent Baker and published by Oxford University Press, USA. This book was released on 2013-03-07 with total page 802 pages. Available in PDF, EPUB and Kindle. Book excerpt: Portfolio Theory and Management examines the foundations of portfolio management with the contributions of financial pioneers up to the latest trends. The book discusses portfolio theory and management both before and after the 2007-2008 financial crisis. It takes a global focus by highlighting cross-country differences and practices.

Download or read book Risk Adjusted Returns written by William Johnson and published by HiTeX Press. This book was released on 2024-10-08 with total page 615 pages. Available in PDF, EPUB and Kindle. Book excerpt: "Risk-Adjusted Returns: Maximizing Profit with Smart Investment Strategies" is an illuminating guide for investors seeking to fuse traditional financial wisdom with modern technological advancements. This book demystifies the complex interplay between risk and return, providing readers with a comprehensive understanding of how to optimize their investment portfolios for long-term success. Each chapter meticulously breaks down fundamental concepts, such as financial markets and asset allocation, before advancing to cutting-edge topics like algorithmic trading and machine learning. By blending these elements, the book equips investors with the tools needed to navigate the ever-evolving financial landscape with confidence and precision. In addition to fostering a solid grounding in the technical aspects of investing, the work delves into the psychological and ethical dimensions of financial decision-making. Through an exploration of behavioral finance and the growing momentum of sustainable investing, it challenges readers to consider how their investment choices impact both their portfolios and the broader world. With insights drawn from current trends and future projections, "Risk-Adjusted Returns" offers a holistic approach to investment strategy, ensuring that readers are well-prepared to seize opportunities and manage uncertainties in the pursuit of enhanced profitability.

Download or read book Postmodern Portfolio Theory written by James Ming Chen and published by Springer. This book was released on 2016-07-26 with total page 345 pages. Available in PDF, EPUB and Kindle. Book excerpt: This survey of portfolio theory, from its modern origins through more sophisticated, “postmodern” incarnations, evaluates portfolio risk according to the first four moments of any statistical distribution: mean, variance, skewness, and excess kurtosis. In pursuit of financial models that more accurately describe abnormal markets and investor psychology, this book bifurcates beta on either side of mean returns. It then evaluates this traditional risk measure according to its relative volatility and correlation components. After specifying a four-moment capital asset pricing model, this book devotes special attention to measures of market risk in global banking regulation. Despite the deficiencies of modern portfolio theory, contemporary finance continues to rest on mean-variance optimization and the two-moment capital asset pricing model. The term postmodern portfolio theory captures many of the advances in financial learning since the original articulation of modern portfolio theory. A comprehensive approach to financial risk management must address all aspects of portfolio theory, from the beautiful symmetries of modern portfolio theory to the disturbing behavioral insights and the vastly expanded mathematical arsenal of the postmodern critique. Mastery of postmodern portfolio theory’s quantitative tools and behavioral insights holds the key to the efficient frontier of risk management.