Behavioral Finance: How Psychology Affects Investing
Introduction Investing is influenced by human behavior and psychological factors, with behavioral finance combining cognitive psychology with economics to explain irrational financial decisions and common biases. Key Psychological Factors Influencing Investment Decisions 1. Overconfidence Bias Overconfidence is one of the most prevalent biases in financial decision-making. Investors often overestimate their knowledge, underestimate risks, and exaggerate […]