The performance of financial markets is closely tied to the sentiments of market participants. When market sentiment is positive, it drives a strong market, whereas negative sentiment can lead to a bearish market, potentially triggering a financial crisis. Traditional finance models often overlook these psychological elements, typically assuming that markets trade at rational levels. In contrast, behavioral finance focuses on how emotions like fear, greed, hope, and panic, as well as factors like climate change and non-traditional influences, can impact market performance. Understanding market psychology is crucial before making investment decisions. Behavioral finance serves as an essential tool for investors aiming to create successful portfolios in today’s volatile markets.
This ENERGY Training Behavioral Finance course offers a unique opportunity for both current and potential investors, as well as financial analysts, to gain insights into market psychology. Participants will explore how emotions and cognitive biases influence financial systems, including concepts like market sentiment, rational versus irrational behavior, noise trading, confidence levels, behavioral biases, loss aversion, overreaction, underreaction, managerial hubris, and both momentum and contrarian technical trading strategies. Additionally, attendees will gain a comprehensive understanding of the financial impacts of these behavioral biases.
Key topics covered include:
- The decline of Neoclassical Finance
- The growth of Behavioral Finance
- The financial impact of behavioral biases
- Behavioral investment strategies I & II
- The latest trends in behavioral fina
By the end of this Behavioral Finance training course, participants will be able to:
- Recognize the behavioral biases, heuristics, and framing effects that hinder maximizing value in corporate financial and investment decisions.
- Evaluate how individual financial behaviors and decision-making impact investment outcomes in financial markets.
- Discuss the key issues when comparing efficient (economically rational) markets with more realistic, less understood behavioral (partially rational or irrational) markets.
- Show how informed investors and corporate decision-makers can mitigate these biases, heuristics, and framing effects to enhance financial and investment decisions.
- Demonstrate a thorough understanding of current market dynamics.
This ENERGY training course will be structured as a highly participative workshop with formal presentations, latest research articles and interactive worked examples using spreadsheets, live technical charts and mock trading exercises. Relevant examples and empirical studies are provided to illustrate the application of each of the topics covered and opportunities are provided to learn and apply the key investment strategies.
The organization will gain significant advantages from the implementation of advanced behavioral science in managing financial market risks, as well as from a heightened understanding of recent advancements in financial management. Specific benefits include:
- Applying psychology and neuroscience to financial decision-making processes
- Making decisions based on current market sentiment
- Acquiring up-to-date knowledge of market dynamics
- Developing critical analysis and interpretation skills for financial innovations and risks
- Increasing awareness of emerging financial opportunities
- Gaining the ability to create a successful portfolio by measuring risk and return, integrating behavioral finance concepts
- Enhancing practical skills in financial forecasting
Participants will gain updated knowledge and practical skills in Behavioral Finance training course, enabling them to make valuable contributions to investment development and improvement, while also advancing their career potential. Specifically, participants will:
- Be equipped to use behavioral models in business decision-making
- Have the opportunity to recognize and correct their own mistakes influenced by personal behavioral biases
- Learn strategies for dealing with others' behavioral biases
- Gain a deeper understanding of how financial markets function
- Develop the ability to make informed financial decisions in volatile market conditions
- Acquire knowledge of current and emerging financial products
- Understand the trends shaping the current market
- Enhance their expertise in financial and investment management
This Behavioral Finance training courses would be relevant to all of those involved in (or planning to join) making investment and sales decisions. This includes private individuals, financial and non-financial institutions, non-profit organizations and government.
This ENERGY training course is suitable to a wide range of professionals but will greatly benefit:
- Financial Accounting Team Members
- Financial Planning and Budgeting Professionals
- Strategic Planning and Head Office Team Members
- Corporate Communication and Investor Relations Professionals
- Investment Analysts and Advisers
- Traders
- Investors in general
- Marketing Analyst
Day One: The Rise and Fall of Neoclassical Finance & The Rise and Rise of Behavioural Finance
- Introduction to Behavioural Finance
- Pillars of Conventional Finance and Behavioural Finance
- The Failure of Neoclassical Finance
- Efficient Market Hypothesis:
- EMH as the Cause of the Global Financial Crisis
- Bubbles and Crashes in the Stock and FX Market
- Market Anomalies
- Why Academia & Authorities Embrace the EMH?
- Discarding Rationality: sources and Examples of Irrationality
- Modern Portfolio Theory & Behavioural Portfolio Theory
Day Two: The Financial Consequences of Behavioural Biases
- Loss Aversion Bias
- Overconfidence Bias
- Representativeness Bias
- Anchoring Bias
- Self-serving Bias
- Disposition Effect
- Managerial Hubris
- Behavioural Biases and Corporate Financial Decisions
Day Three: Behavioural Investment Strategies I
- Noise Trading
- Technical Analysis
- Momentum Trading
- Contrarian Investment Strategies
- High Frequency Trading and Multilateral Trading Platforms
- Energy Trading
- Commodity Trading
- Terrorism Risk
Behavioural Investment Strategies II
- Fund Managers’ Behaviour
- The Green Effect & Sustainable Finance
- Fintech & Cryptocurrency
- Black Friday Effect
- Derivative Trading
- Forwards
- Futures
- Options
- Swaps
- Financial Volatility from Brexit and COVID-19
Day Five: Recent Developments in Behavioural Finance
- Ecology and Finance
- Neuroscience
- Emotional Finance
- Quantitative Behavioural Finance
- Narcissism, Political Tenure, Financial Indicators, and the Effectiveness
- Trumpism Economics
- Enhance their expertise in financial and investment management