IDEAS home Printed from https://ideas.repec.org/h/pal/pmschp/978-1-137-29377-0_1.html
   My bibliography  Save this book chapter

Introduction

In: Asset Pricing, Real Estate and Public Finance over the Crisis

Author

Listed:
  • Alessandro Carretta
  • Gianluca Mattarocci

Abstract

Main theory on efficient financial markets assumes that the price of an asset is always related to its fundamental value and any misalignment is driven by noise and so it is unpredictable (Fama, 1965). Literature demonstrates that irrational behaviour characterizes almost all the markets and random price dynamics in the financial market could be used in order to construct profitable investment strategies (i.a. De Long et al., 1990). The current financial crisis shows that market prices do not deviate from a theoretical equilibrium in a random manner and there is a two-way reflexive connection between perception and reality which can give rise to initially self-reinforcing but eventually self-defeating boom-bust processes, or bubbles (Soros, 2008; Carretta et al., 2011).

Suggested Citation

  • Alessandro Carretta & Gianluca Mattarocci, 2013. "Introduction," Palgrave Macmillan Studies in Banking and Financial Institutions, in: Alessandro Carretta & Gianluca Mattarocci (ed.), Asset Pricing, Real Estate and Public Finance over the Crisis, pages 1-4, Palgrave Macmillan.
    • Handle: RePEc:pal:pmschp:978-1-137-29377-0_1
    DOI: 10.1057/9781137293770_1
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:pmschp:978-1-137-29377-0_1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.