Probing investors' psyches
Vibhas Ratanjee and Verapong PaditpornThe Gallup Organization Bangkok, Thailand
INTRODUCTION
Much of economic and financial theory has traditionally been based on the notion that individuals act rationally and consider all available information in their decision-making process. However, researchers around the world have uncovered substantial evidence to the contrary.
A case in point is the process of stock trading, where academic studies have documented many glaring examples of irrational behavior and repeated errors in judgment. So what, if any, are the factors that lead to this behavior by what are otherwise rational, reasonably intelligent humans,...